Bitcoin miners could face severe semiconductor shortages as 16nm chip costs rise 20%

Concerns about a severe shortage of semiconductor chips are once again making headlines. Reports from Malaysia indicate that the supply chain of semiconductor manufacturers is suffering from the rise in confirmed COVID-19 cases. Mining machines that ensure the security of the Bitcoin network are also powered by these chips, and semiconductor prices may increase by more than 20% in the near future.

On August 24, Bosch, a well-known German technology and engineering company, explained that the semiconductor supply chain has been broken and the world is currently facing a severe chip shortage. The new coronavirus is causing great trouble to semiconductor manufacturing centers like Malaysia.
The rise in coronavirus cases in Malaysia is said to have led to a chip shortage, with major suppliers such as STMicroelectronics Nvamong, NXP Semiconductors NV and Infineon Technologies AG operating chip factories in the country. Despite Taiwan's near-zero coronavirus cases, a regional report indicates that Taiwan Semiconductor Manufacturing Co. (TSMC) may raise chip prices by 20%. Unnamed sources at integrated circuit design companies said TSMC has informed major customers that all chips involving processes below 16 nanometers may increase in price by 10-20%. Smartphones, computers, cars and bitcoin miners all use chips below 16 nanometers, with some top bitcoin miners even using 10-nanometer to 7-nanometer semiconductors. Taiwan says it is doing its best to help solve the chip problem.
Similar to the situation a few months ago, the official websites of some top mining machine manufacturers show that the physical mining machine products are completely sold out. A few companies do have mining machines for sale on site, such as Bitmain, which currently has mining machines for sale, and the machines will be shipped within ten business days after "full payment". At press time, the cost of the Antminer S19j Pro 100 TH/s is $10,000 per unit. The other five Antminers advertised by Bitmain on the website are completely sold out. Every once in a while in 2021, companies like Bitmain, Canaan, and Microbt will announce large sales to some of the largest mining operations in the world. Ordinary consumers are forced to purchase Bitcoin mining machines through second-market suppliers, who usually add a large premium.
Meanwhile, some car companies are recently cutting production because companies like BMW, Toyota, and Volkswagen are having big problems getting chips. The head of Taiwan's economy addressed the public on Tuesday, saying that Taiwan is doing everything possible to keep the semiconductor supply chain stable. In the long run, in addition to the fact that the supply chain tightening has led to shortages, the impact of the global semiconductor supply shortage could stall Bitcoin mining operations and cause manufacturers who build these machines to stagnate. If these shortages continue, items like system-on-chips (SoCs), CPUs, GPUs, ASICs, and controllers could incur higher costs in the future.