Intel enters the bitcoin mining business
Could we see ARM entering this space as well?
The key story
Intel has officially announced that they will be launching brand new chips later this year. These new chips will be specially designed for bitcoin mining in mind (i.e. it should be very energy efficient to run SHA256 computations on these chips).
What is SHA256?
Quick aside, SHA256 refers to the cryptographic hash function involves in Bitcoin proof of work mining. If you know a little about Bitcoin PoW system, you’ll know that the goal is to find a number (called a nonce) such that the hash of this nonce and some other information outputs a value smaller than some target.
ASICs (no not the running shoes)
The current industry standard for Bitcoin mining is specialized processors called ASICs.
Implications
So what are some key implications?
Bitcoin mining may become more energy efficient. A common criticism of Bitcoin PoW mining is that it is energy intensive and environmentally unfriendly. This may change if we see huge efficiency gains with these new Intel chips.
More specialized hardware for blockchain in the future? Just like how specialized hardware for machine learning allowed for significant improvement in performance, we may see different blockchain systems leveraging such technology. While it is unclear what will exactly happen, one can hope for a decentralized system with low transaction fees!
A more decentralised network? As organisations such as mining farms emerge, Bitcoin became more centralised as mining power is concentrated among smaller groups. If one day these chips allow the expected value of mining for individuals to be positive, we may see a trend back towards individuals mining.