Application-specific integrated circuit (ASIC) chips are essential to the bitcoin (BTC) mining sector. These machines are designed for one specific task: to process Bitcoin’s SHA-256 algorithm as rapidly as possible to earn block rewards.
They excel in this role. The Antminer S19, a leading ASIC machine, can perform 82 trillion calculations per second — that’s 820 times the estimated number of stars in the Milky Way. The ASIC manufacturing market, valued at approximately $30 billion, is predominantly controlled by Bitmain, a company whose devices account for around 80% of Bitcoin’s hashrate.
However, the Singapore-based mining company Bitdeer (BTDR) aims to disrupt this landscape with a new ASIC chip architecture. According to the company, these innovative chips could significantly enhance efficiency while also promoting transparency in the ASIC development process.
“The two major players [Bitmain and MicroBT] are both private entities and relatively secretive,” stated Jeff LaBerge, Bitdeer’s head of capital markets and strategic initiatives, in a conversation. “They don’t really interact with the media or provide guidance on their research and development, which complicates planning for end-users.”
“We want our clients to be aware of our position in the manufacturing process, our roadmap for upcoming chip designs, and our current production status,” LaBerge added.
Shanon Squires, chief mining officer at a bitcoin hosting company, mentioned that increased transparency in ASIC production would assist miners in strategically planning hardware shipments and anticipating Bitcoin’s difficulty increments. “Bitdeer’s dedication to transparency is excellent for the mining community,” she remarked.
“Canaan shares its annual sales figures for various mining models, but Bitdeer goes further by providing more regular updates on delivery volumes,” explained Wolfie Zhao, head of research at TheMinerMag. “While both companies are relatively smaller players in the hardware space, their efforts demonstrate a commitment to fostering transparency, which we hope will inspire larger competitors to take notice.”
Pursuing Efficiency
ASIC chips have largely followed the same design template since 2014. Over the past decade, the most significant gains in power efficiency have emerged at the foundry level, primarily due to advancements made by leading chip manufacturer TSMC. Although miners have made some changes to chip designs, these alterations have yielded only slight improvements.
Nonetheless, the upgrades have been substantial. The very first ASIC, Canaan’s Avalon (2013), had a power efficiency of 6,000 joules per terahash (J/TH). In contrast, Bitmain’s current top performer, the Antminer S21XP Hydro, offers an impressive 12 J/TH efficiency.
Bitdeer, now listed on Nasdaq, aims to establish an entirely new architecture for its ASIC products. “We believe it’s crucial to achieve what we call the single-digit efficiency range,” LaBerge said, referring to mining rigs that operate with less than 10 J/TH efficiency.
Advancements using the conventional design require increasingly thinner chips. However, thinner chips are more prone to defects, leading to reduced yields from each batch. “You’re also competing with major companies like Apple and Nvidia for the same materials,” LaBerge noted.
Bitdeer’s Chief Strategy Officer, Haris Basit, is spearheading an engineering team focused on developing this new framework. LaBerge acknowledged that some team members were involved in creating Bitmain’s first ASIC chips in 2014, the architecture of which set the industry standard. (Bitmain did not provide a comment.)
Bitdeer’s research has already demonstrated success. The company’s latest product, the SEALMINER A3, achieved a power efficiency of 9.7 J/TH in performance testing, which could potentially surpass the S21XP Hydro’s efficiency crown.
Meanwhile, the SEALMINER A4, which will utilize the new chip architecture, is anticipated to operate at 5 J/TH, likely making it the most efficient ASIC on the market by a wide margin.
“People have long understood the potential for recycling [the electrical] charge on a chip, but few have succeeded in doing this effectively for high-performance applications… We’ve managed to crack the code on how to employ this method in highly productive situations,” Basit mentioned during a podcast interview.
“Instead of utilizing [the charge] once and then discharging it, we’re able to use it multiple times — four, five, even six times. This results in a 75-80% boost in efficiency,” Basit elaborated.
“Our SEALMINER A4 chips will incorporate this technology, and we believe it could apply more broadly to digital chips, particularly those that are frequently active, like GPUs and signal processing components.”
Chip Manufacturing
Crafting ASICs is a complex task. Bitdeer’s research division is split into two branches (one located in Singapore and another in Silicon Valley) focused on creating new chip designs. “For a machine that seems straightforward — as it only needs to solve the SHA-256 algorithm — the design process is incredibly complex. We have some of the top engineers in the field working on this,” LaBerge remarked. The company invests about $6-8 million in research every quarter.
So far, Bitdeer has been successfully launching new products quickly. The firm introduced both the SEALMINER A1 and A2 in 2024 and anticipates that the A3 will begin mass production in the latter half of 2025. The A4 is projected to reach the tape-out phase (the final step in its design process) by the third quarter of the year, with a release likely in late 2025 or early 2026.
After a new chip design is completed, Bitdeer sends the specifications to TSMC. As the world’s largest chip manufacturer, TSMC possesses the most advanced technology, making this partnership crucial for Bitdeer.
“You can’t simply approach TSMC and request, ‘I need 100 exahash worth of chips in three months.’ There’s a process to follow,” LaBerge explained. “You first inquire about chip allocation, and they assign it based on priorities.”
Once Bitdeer provides the design, TSMC generates a mask, which serves as a template for producing the chips—similar to how a printing press operates. The mask is sent to Bitdeer along with risk chips (a small pilot batch of chips for testing) to ensure the design functions correctly. If modifications are necessary, TSMC makes the adjustments based on Bitdeer’s input and sends an updated mask along with a new batch of risk chips. This entire process incurs considerable costs, with Bitdeer spending approximately $14 million on the A2’s tape-out, and the A3 requiring even more investment, according to LaBerge.
Once Bitdeer approves a design, TSMC utilizes the mask to mass-produce wafers. LaBerge likened wafers to sheets that each can accommodate hundreds of chips. Technically, a mask can be employed to generate an almost limitless number of wafers, but TSMC’s capacity is finite, leading to competition among firms for chip production.
A key advantage of the A4’s design, as noted by LaBerge, is its capability to simplify the chip allocation process. “[Basit] challenged the team to devise a new architecture that didn’t rely on TSMC’s latest processes, allowing us to revert to an earlier node, which has significantly lower demand,” he shared. A semiconductor node refers to a specific generation of chip manufacturing technology; TSMC consistently builds new nodes to enhance its processes.
It typically takes about three months for Bitdeer to receive its mask and risk chips after submitting a design to TSMC. Following that, there is an additional three to four-month period before the company receives its chips once the foundry receives the go-ahead for mass manufacturing. The chips are sent directly to Bitdeer’s production facilities in Asia, where it may take an additional four to eight weeks for the mining rigs to be fully assembled and packaged.
Aiming High
Despite the considerable costs associated with production, some of the funding needed for ASIC manufacturing comes from Bitdeer’s clients.
Miners interested in acquiring Bitdeer’s ASICs typically submit a deposit between 25% to 50% of the total order cost. The production cycle generally lasts six to seven months, so the company can quickly recoup its investment and achieve profitability.
Manufacturing ASICs also presents advantages for Bitdeer’s mining operations. Until recently, the firm has primarily focused on acting as a hosting provider, allowing other bitcoin miners to set up their rigs in its facilities. Bitdeer is gradually pivoting from this model and expanding its own mining operations in conjunction with its ASIC manufacturing endeavors.
Acquiring ASICs represents one of the most significant expenses in establishing a bitcoin mining operation. Typically, these machines have a lifespan of about three to four years before newer models render them outdated, prompting bitcoin mining entities to constantly seek upgrades.
By producing its own machines, Bitdeer can substantially lower these costs, and it retains the option of selling its mining rigs to other firms as necessary.
Ultimately, Bitdeer aspires to compete directly with Bitmain and MicroBT, aiming to disrupt what LaBerge refers to as the ASIC market’s duopoly. “We want to emerge as the leading player in the sector, without question,” LaBerge asserted. “We believe we have both the talent and technology to achieve that.”