According to analyst estimates at Bernstein, a mysterious startup in China called Bitmain, which dominates the Bitcoin digging industry, a...
According
to analyst estimates at Bernstein, a mysterious startup in China called
Bitmain, which dominates the Bitcoin digging industry, appears to have
earned the equivalent of the chipmaker Nvidia last year.
Based on conservative estimates of gross margins of around 75% and operating margin of 65%, analysts calculated that Bitmain generated operating profit of $ 3 billion to $ 4 billion a year. 2017. Bernstein's semiconductor analyst group estimates that Nvidia's operating profit for the same period is about $ 3 billion.
"But Bitmain achieves this in just four years, while it takes 24 years for Nvidia to reach that number," Bernstein analysts said in a report released Wednesday.
Bitmain - The giants in the Bitcoin worldBitmain,
the startup in Beijing, was founded in 2013 by Jihan Wu and Micree
Zhan. Since then, the company has grown into one of the key players in
Bitcoin, the process of using computing power to create. out of the Bitcoin co. Wu is also a celebrity in the Bitcoin world.In
the early days of Bitcoin, the enthusiasts with it could use
conventional graphics cards that had enough computing power to make a
profit from coding the codec. But
by 2013, a company in China turns the bitcoin digging into a
specialized process by selling integrated circuits specifically for
specific applications (ASICs), so that computer chip cards are
available. Bitcoin can be up to 50 times faster than traditional graphics cards.Currently,
Bitmain is selling Bitcoin drilling rigs called Antminer at prices
ranging from a few hundred to several thousand dollars per set. The company also operates a "mining pool" - in which the participants jointly dig Bitcoin to cut costs. As a result, Bernstein estimates that Bitmain accounts for 70-80% of the Bitcoin and ASIC diggers.
The revenue of Bitmain (colored part) comes from many parts of the supply chain for digging Bitcoin.Analysts
estimate that the majority of Bitmain's revenue is generated from the
sale to Bitcoin diggers using the company's chips. "The
rest is largely created by digging, and to a lesser extent the
management fee collected from the tanks that they operate, and leases
processing power from the Bitcoin digging farm. through cloud services. "Bernstein's report also said that much of the increase in Bitcoin sales came from the steep rise in Bitcoin prices. The company's analysts also point out that "Bitmain carefully adjusts prices for Bitcoin diggers."So,
according to Bernstein's estimate, when the Bitcoin price climbed to $
20,000 at the end of last year, the price of the Antminer S9 climbed to
nearly $ 5,000 while production costs remained unchanged.
The correlation between the Bitcoin price and the Antminer S9 platform, while production costs of S9 were almost unchanged.
In conclusion, the analysts at Bernstein also looked at Bitmain's purchase of TSMC and estimated that the startup contributed between 2% and 3% Total revenue of this chip maker last year.
"In 2018, Bitmain will likely lead the ASIC chip industry to pre-encode and move some of its chips to 10nm and the most advanced 7nm technology," the report said. "That will make the company one of the top five users of TSMC's 7nm chips in 2018, with demand comparable to Qualcomm, HiSilicon and AMD."
Demand for 7Mm chip by TSMC outsourced by each company.But long-term growth is not guaranteed, especially in the pre-coding world of change. Bitcoin lost half its value in about two months amid fears of tightening regulators.So
far, the Chinese authorities have taken some aggressive action by
banning ICO activities and causing the Bitcoin trading activity in the
country to stall.Bitmain has taken strategic steps to get ahead of the situationAccording
to Bernstein's report, at the end of April, the company launched a new
tank in Israel, and is opening up its mining operations in Canada and
Switzerland, and its regional headquarters in Singapore. Bitmain is also expanding its business to other digital currencies such as Ethereum and Monero.Analysts
at Bernstein say the Chinese company has a "huge cash position" that
will help them weather the industry's difficult times. And
with Bitcoin's Bitcoin business, Bitmain protects itself from losing
too much to speculators by selling chips to diggers, rather than digging
for Bitcoin itself."Some money is still left to the customer, but there are a lot of risks," the report said. "In our view, the result is remarkable."
Based on conservative estimates of gross margins of around 75% and operating margin of 65%, analysts calculated that Bitmain generated operating profit of $ 3 billion to $ 4 billion a year. 2017. Bernstein's semiconductor analyst group estimates that Nvidia's operating profit for the same period is about $ 3 billion.
"But Bitmain achieves this in just four years, while it takes 24 years for Nvidia to reach that number," Bernstein analysts said in a report released Wednesday.
Bitmain - The giants in the Bitcoin worldBitmain,
the startup in Beijing, was founded in 2013 by Jihan Wu and Micree
Zhan. Since then, the company has grown into one of the key players in
Bitcoin, the process of using computing power to create. out of the Bitcoin co. Wu is also a celebrity in the Bitcoin world.In
the early days of Bitcoin, the enthusiasts with it could use
conventional graphics cards that had enough computing power to make a
profit from coding the codec. But
by 2013, a company in China turns the bitcoin digging into a
specialized process by selling integrated circuits specifically for
specific applications (ASICs), so that computer chip cards are
available. Bitcoin can be up to 50 times faster than traditional graphics cards.Currently,
Bitmain is selling Bitcoin drilling rigs called Antminer at prices
ranging from a few hundred to several thousand dollars per set. The company also operates a "mining pool" - in which the participants jointly dig Bitcoin to cut costs. As a result, Bernstein estimates that Bitmain accounts for 70-80% of the Bitcoin and ASIC diggers.The revenue of Bitmain (colored part) comes from many parts of the supply chain for digging Bitcoin.Analysts
estimate that the majority of Bitmain's revenue is generated from the
sale to Bitcoin diggers using the company's chips. "The
rest is largely created by digging, and to a lesser extent the
management fee collected from the tanks that they operate, and leases
processing power from the Bitcoin digging farm. through cloud services. "Bernstein's report also said that much of the increase in Bitcoin sales came from the steep rise in Bitcoin prices. The company's analysts also point out that "Bitmain carefully adjusts prices for Bitcoin diggers."So,
according to Bernstein's estimate, when the Bitcoin price climbed to $
20,000 at the end of last year, the price of the Antminer S9 climbed to
nearly $ 5,000 while production costs remained unchanged.In conclusion, the analysts at Bernstein also looked at Bitmain's purchase of TSMC and estimated that the startup contributed between 2% and 3% Total revenue of this chip maker last year.
"In 2018, Bitmain will likely lead the ASIC chip industry to pre-encode and move some of its chips to 10nm and the most advanced 7nm technology," the report said. "That will make the company one of the top five users of TSMC's 7nm chips in 2018, with demand comparable to Qualcomm, HiSilicon and AMD."
According to Nguyen Hai
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