Crypto mining company Bitmain has put more pressure on the market after placing a 5nm chip order with Taiwan Semiconductor Manufacturing Company TSMC.
Bitmain is looking to increase its efficiency and speed when it comes to crypto mining, which is likely due to the recent bullish narrative of bitcoin (BTC) and ethereum (ETH).
TMSC will start the manufacturing of the chips later this year and expecting to finish early in 2022. It is unknown how much of TSMC’s supply has been bought by Bitmain, but TSMC was predicted to up their production of chips from 55,000 to 60,000 wafer starts per month to 110,000 to 120,000.
The chips shortage began in January 2021, when the global demand of semiconductors massively outweighed the supply. The chip shortage affects a host of industries from children’s toys, technologies, to the motor industry.
McKinsey lead on semiconductors Ondrej Burkacky said that the chip shortage is a universal issue and might lead to some products being unable to be created. “At some point, consumers will be affected by the chip crisis,” he said and added:
“The high noon season for consumer electronics are Q3 and Q4, and there might be shortages of several products during this time.”
At the moment Apple remains the largest consumer of the chips produced by TSMC, as the software giant uses the chips to make iPhone 12, iPad Air, and iPad Pros.
Global need for the chips
Despite efforts from chip manufacturers to keep up with demand, the global need for the chips is too great. Chip sales reached $40 billion in January of 2021, which is an increase of 13.2% from January of 2020.
The surge in demand is likely a ramification of the covid-19 pandemic. The chips are used in the making of technologies from laptops to televisions, and with many people working from home or keep themselves entertained, the need for these devices sky-rocketed.
Meanwhile, a new report on the crypto mining industry has indicated that the market could grow by $2.8 billion between now and 2024. The report also stated that mining is likely to increase as a result of a growing number of mining pools, product launches, and crypto-dedicated hardware.