Bitcoin mining relies heavily on specialized hardware known as Application-Specific Integrated Circuits (ASICs) miners. The production of these ASICs is tied to the global semiconductor industry. The manufacturing of advanced chip wafers is largely concentrated in the hands of a few powerful foundries. Taiwan Semiconductor Manufacturing Company (TSMC) and Samsung Electronics dominate the market, particularly for the cutting-edge nodes required for high-performance ASICs. This dependence on a limited number of suppliers creates a potential bottleneck for Bitcoin mining hardware manufacturers, raising concerns about supply chain vulnerabilities and potential disruptions. Let’s dive in!
The Complex Semiconductor Supply Chain
ASIC Miner Manufacturers are Fabless Companies
The Advantage of the Fabless Model in Bitcoin Mining
The Concentrated Foundry Market
ASIC Manufacturers Chip Sourcing
Bitmain, MicroBT, Canaan, Bitdeer, Auradine & Block
Premium Members Only:
Challenges for Fabless Bitcoin ASIC Companies
Supply Chain Bottlenecks
Geopolitical Risks
Innovation Pressure and Technological Barriers
Foundries Manufacturing in the U.S.
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The Complex Semiconductor Supply Chain
The semiconductor supply chain is highly complex and globalized, with various actors specializing in different stages of the production process. For example raw material suppliers provide essential materials like silicon and rare earth elements, while equipment manufacturers design and supply machinery for wafer fabrication, lithography, etching, and testing in semiconductor manufacturing. Fabless design companies focus on designing semiconductors and outsource manufacturing to foundries.
Foundries are specialized semiconductor manufacturing plants where chips are fabricated. They play a pivotal role in the Bitcoin ASIC supply chain by producing the highly advanced chips that power mining machines. Unlike general-purpose chips, Bitcoin ASICs are designed for a single function: solving the SHA-256 algorithm efficiently. This specificity requires cutting-edge semiconductor technology, often at the most advanced process nodes, such as 5nm or even 3nm.
ASIC Miner Manufacturers are Fabless Companies
Bitcoin ASIC miner manufacturers like Bitmain and MicroBT are critical players in the Bitcoin mining supply chain. These companies design, produce, and distribute specialized Bitcoin mining hardware.
They are considered fabless just like Nvidia, AMD and Qualcomm. Fabless companies are businesses that design and sell semiconductor chips but do not own or operate the fabrication facilities (fabs) needed to manufacture them.
ASIC manufacturers rely on chip foundries to produce the custom chips that power Bitcoin miners, while peripheral component manufacturers supply essential components that support the operation of ASIC miners, including power supplies, fans, and motherboards.
Once ASIC chips are produced, manufacturers assemble them into mining rigs, integrating heat sinks, control boards, networking interfaces etc. Manufacturers handle both chip design and rig assembly in-house.
The Advantage of the Fabless Model in Bitcoin Mining
The fabless model allows ASIC miner manufacturers to focus on R&D, innovating and improving mining efficiency with each chip generation. Being fabless also makes hardware manufactures to be cost efficiency. They avoid the enormous costs of owning fabs, which require billions of dollars in investment. Lastly, this model allows the manufactures to quickly adapt to increased demand by scaling production lines.
The Concentrated Foundry Market
There are only a few key players in the semiconductor foundry market. TSMC (Taiwan Semiconductor Manufacturing Company) is the largest and most advanced foundry. TSMC is renowned for its cutting-edge technology and high-volume production capabilities. It is the go-to choice for many Bitcoin ASIC manufacturers. Samsung Foundry is another major player competing for market share in the high-performance computing (HPC) sector, including Bitcoin mining.
In 2024 the total revenue of the global foundry industry was was $131.7 billion. The image below shows the top semiconductor foundry companies by market share. As of January 2025, Asian countries like Taiwan, China, and South Korea lead the semiconductor foundry market. Taiwan dominates, with TSMC holding 62% of total foundry revenue. Including UMC, VIS, and PSMC, Taiwan’s market share surpasses 70%. South Korea follows, driven by Samsung’s 10% share, while the U.S. and China contribute through GlobalFoundries (6%) and SMIC (5%), respectively.
TSMC dominates the semiconductor market. To stay ahead, TSMC is investing heavily in sub-2-nm technology and expanding its capacity with four advanced fabs in Taiwan and new facilities in Arizona, Japan, and Germany, catering to various process nodes. Samsung is bolstering its position with expansions in South Korea and a Texas fab focused on 11–14 nm FinFET technology for radio-frequency applications.
The race for sub-2-nm foundries is heating up, with TSMC, Samsung, and Intel pouring billions into innovation to meet the global demand for smaller, faster, and more powerful chips.
ASIC Manufacturers Chip Sourcing
Bitmain
Bitmain has established itself as a dominant player in the Bitcoin ASIC market with over 75% of the market share. For a big part this is thanks to its strong partnership with TSMC. This long-standing collaboration enables Bitmain to utilize TSMC’s advanced semiconductor nodes, including 5nm technology, for its latest Antminer series. This relationship ensures that Bitmain maintains a leading edge in ASIC efficiency and performance, solidifying its position in the industry.
MicroBT
MicroBT, is the second biggest competitor in the Bitcoin ASIC market. It’s older generation Whatsminers include TSMC chips, the newer series rely on Samsung. While Bitmain uses 5nm chips for their most efficient machines, MicroBT applies 3nm. The Whatsminer M56S++ was the first miner that included Samsung’s 3nm GAA chip.
Canaan
Canaan, known for its Avalon series, also relies on TSMC for chip manufacturing. They recently launched Avalon Nano 3S Home Miner has a chip size of 4nm. It delivers a maximum hashrate of 6 TH/s with 140W power consumption.
Bitdeer
Bitdeer, the sixth largest publicly traded Bitcoin miner by installed hashrate, sources from TSMC. For their SEALMINER A1, Bitdeer uses the SEAL01 4nm process chip. Although it is not specifically mentioned on their SEALMINER technology roadmap, it is likely the A2 also includes the 4nm chip.
Auradine
Auradine is a Silicon Valley-based company, aiming to offer North American Bitcoin mining operators an alternative to “foreign ASICs,” competing against Chinese manufacturing giants Bitmain, MicroBT, and Canaan. In Q2 2024 the company brought their Teraflux AT2880 air-cooled miner to market designed and built in the U.S. using 3-nanometer processing technology. Auradine did not publicly disclose its chip supplier.
Block
Block Inc., the fintech company formerly known as Square and led by Jack Dorsey, has partnered with Core Scientific to develop a modular mining platform capable of delivering approximately 15 EH/s of Bitcoin mining capacity. Block’s Proto team will be using 3nm chips that are being developed in partnership with ePIC Blockchain, a mining system developer previously involved in Intel’s Bitcoin mining ASIC projects. Where these 3nm chips are sourced was not disclosed.
The following content is exclusively for our Premium Members:
Challenges for Fabless Bitcoin ASIC Companies
Supply Chain Bottlenecks
Geopolitical Risks
Innovation Pressure and Technological Barriers
Foundries Manufacturing in the U.S.
