Bitcoin mining is overheating in more ways than one, turning ASIC makers into victims of their minerscube bitcoin mining success. How Can I Buy Bitcoin?

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What Can a Blockchain Do? What is a Distributed Ledger? How Do I Use Ethereum? What is a Decentralized Application? How Do Smart Contracts Work? The bitcoin mining industry has witnessed massive change over the past two years. Cold War arms race, additional investments may prove unsustainable in the long run due to ROI constraints.

Currently, miners are hitting the wall. Technology is the first problem. 16nm FinFET ASICs are expected next year. Yet progress is slowing down due to a number technical limitations plaguing all chipmakers.

The second problem involves economics. It is more down to earth, but it is closely related to chip design and manufacturing. Bigger chips manufactured on relatively immature processes tend to be costlier to produce and develop. They usually face yield and leakage issues as well. The first technical challenge can be described as the thermal barrier.

Simply adding more transistors and building massive chips with billions of transistors delivers more performance, but cooling these chips becomes troublesome and impractical. At the same time efficiency becomes an even bigger problem. As an emerging field of IC design, bitcoin mining ASICs have experienced rapid evolution over the past two years. However, they cannot keep evolving and developing at the current rate. A number of technical limitations and Moore’s Law simply cannot be overcome even by the world’s foremost chip designers and foundries. Performance scales accordingly, but this does not mean that performance increases at a linear rate, as chip designers can optimise microarchitectures without piling on more transistors, hence yielding more performance from a the same number of transistors and chip area.

ASICs differ from general purpose processors and a lot less money goes into its development and optimisation. As it matures, optimisation gets more difficult. This means ASIC design will inevitably slow down. Since most ASICs already use cutting edge manufacturing nodes and there is a limit to how big practical designs can be, more resources will have to go into optimisation, performance-per-Watt tweaks and state of the art cooling technology. This approach involves more spending and development than a transition to a new manufacturing process and it usually does not yield the same performance or efficiency increase. ASIC designers tend to keep a lot of information away from prying eyes. ASIC makers reveal some basic specs, such as the number of processing cores and the size of the chip package, but they do not paint the full picture.