In brief

  • The largest Bitcoin miners are shifting to AI chipmaking, said a new report.
  • The two main reasons are yield stability and lack of profits from mining.
  • The AI industry is promising and poised for further growth.

Changing market dynamics has caused three of the largest Bitcoin mining manufacturers, Bitmain, Ebang, and Canaan, to shift their long-term focus from mining rigs to AI chips, according to a report by analytics firm TokenInsight.

Chip research and development is the core competitiveness of mining machine manufacturers. The industry boasts billions of dollars in revenue each year, with Bitmain alone pocketing over $300 million in the first quarter of 2020, as per another report.

However, the profits are diminishing. TokenInsight said that after the Bitcoin halving, the mining costs of older mining machines have risen sharply and put millions of dollars of revenue at stake for the three firms.


In addition, newer rig makers such as WhatsMiner and the advent of proof-of-stake cryptocurrencies—which do not rely on mining pools—are further challenging the profitability of the bigger firms.

“From a long-term perspective, blockchain mining has changed from its original high-yield state to deterministic and stable returns,” said TokenInsight. This has, partly, caused mining makers to look at other sectors for revenues.

A Bitcoin mining farm
A mining farm owned by Bitmain in China. Image: Twitter

AI to the miners' rescue

That’s where artificial intelligence (AI) steps in. Mining firms have both the technological prowess and the finances to pivot to AI chip making. AI chips are specialized processors that conduct millions of calculations per second to run mining software, similar to how mining chips operate. This opens up a new revenue stream for older firms like Bitmain and Ebang.

“The research team believes that AI chips have broad prospects and that they have a high degree of overlap with mining machine chips in terms of design and manufacturing,” the report said.

It added, “mining machine manufacturers' experience in mining machine chips can also be quickly transplanted to the field of AI chips. As a result, AI chips are bound to become a battleground for mining manufacturers.”


Bitmain already jumped on the AI bandwagon in 2018. The firm released Sophon, an AI chip that touted millions of calculations per second, to take on the likes of internationally-renowned chipmakers Nvidia and AMD.

Two years later, that bet seems to have been a good call by Jihan Wu, the founder of Bitmain, now that Ebang and Canaan are following suit.

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