A Beginner’s Guide to Application-Specific Integrated Circuits (ASIC)
Since the creation of cryptocurrency, the price of the assets have absolutely skyrocketed. Those who recognized the potential of cryptocurrency and invested early, knew it was only a matter of time before the price of the asset class would rise. They understood that acquiring them early, while they are still cheap and easy to get, is an excellent long-term investment. However, in the spirit of decentralization, crypto also incentivized its community to run its networks.
The incentive for doing so came through crypto mining, which was an easy way to acquire new coins. Over time, as prices grew, more people were attracted to mining. The difficulty of mining grew as well, so specialized equipment was necessary to participate. This led to the creation of Application-Specific Integrated Circuits (ASIC) miners. If you are new to the concept, this guide will tell you everything you need to know about them.
What Is an Application-Specific Integrated Circuit (ASIC)?
Application-Specific Integrated Circuit, or ASIC, for short, is a name for machines created for crypto mining. ASIC crypto mining is primarily used for mining Bitcoin, although ASIC miners can be used to mine a variety of different cryptocurrencies. Given the fact that they are specialized crypto mining gear, ASICs can mine digital assets in large quantities.
This makes them significantly more efficient than CPUs or GPUs, which were used for mining in the past. They command immense computing power, and they are run by specialized software. However, all of this also makes them very expensive, and an average miner typically cannot afford them. There are different models of ASIC miners made by different companies. Depending on which one you buy, the price can go anywhere between $400 and $12,000, on average.
It;’s also worth noting that ASIC technology doesn’t work for every cryptocurrency. In fact, most ASICs are made to mine one specific coin, which can be Bitcoin or some other supported crypto. The coin in question also has to use the Proof of Work (PoW) mechanism in order to be ASIC-friendly. Even then, the miner must be specially made and optimized for that specific coin in order to work. Otherwise, the coin is considered ASIC-resistant.
What Is ASIC Resistance?
As mentioned, ASIC technology does not work for every crypto. Coins that the ASIC miner doesn’t support are referred to as ASIC-resistant assets. This includes cryptos that use ASIC-resistant algorithms, which makes ASIC crypto mining less efficient or even impossible. Typically, these are coins that use their own mining algorithms rather than Proof of Work.
Ethereum is the best example of a cryptocurrency made to resist ASIC crypto mining. After its upgrade, Ethereum has switched to Proof of Stake. As such, it is not being mined anymore. However, even before that, mining Ethereum with ASIC was possible but very inefficient. It was too costly and time-consuming for the amount the miner would get in return.
ASIC are typically frowned upon within the crypto community. Since they are so expensive, only a handful of miners can actually afford them. This implies that any cryptocurrency that depends on ASIC miners for mining is in danger of its mining becoming centralized. ASIC-resistance prevents that, and it allows anyone with CPU and GPU to engage in mining. Since GPUs are much more affordable, that means more people can join in. As a result, the mining of that crypto becomes more decentralized.
Mining Crypto With CPU, GPU, and ASIC
When it comes to crypto mining, your mining hardware of choice matters a lot. In the early days of the cryptoindustry, mining was possible with a regular CPU. When you mine cryptocurrencies, you essentially use your computer’s processing power to solve complex mathematical equations. This is a system set in place to ensure the consistency of time required to mine coins.
In Bitcoin’s case, the time required to mine a block and get the coins is 10 minutes, on average. Now, the more processing power the algorithm has at its disposal, the faster the equation gets solved. In theory, a miner with the computing power of 10 computers could solve a block in 1 minute. To prevent this, Bitcoin’s mysterious creator, Satoshi Nakamoto, introduced mining difficulty.
Basically, the network detects the processing power at its disposal, and it increases the difficulty of the block. That way, it ensures that the mining process would take 10 minutes. In time, as mining became increasingly popular, regular CPUs became inefficient. They simply couldn’t provide the processing power needed to solve the increasingly difficult blocks. As a result, people started using GPUs.
GPUs have more processing power than CPUs, so for a time, GPUs were more than enough to continue mining. However, the same thing happened again. More miners came, and GPUs slowly started becoming less and less efficient. This ultimately led to the creation of ASIC miners.
Advantages and Disadvantages of Using ASIC Miners
Advantages
ASIC miners have their own advantages and disadvantages. Miners who are thinking of acquiring ASIC miners should be well aware of these aspects before purchasing one.
For example, ASIC advantages include things such as great performance and energy efficiency. ASICs focus on mining only a single crypto, this leads to increased consistency and overall performance. The fact that they do not require optimizing for several coins saves time and effort. As such, they are often more efficient than GPUs.
Interestingly, they are also energy-efficient, which is also a good thing for the miner. Assuming that they mine a particularly volatile cryptocurrency, a sudden drop in value could reduce the miner’s earnings. However, with consistent and low power consumption, miners don’t have to worry about the bill being higher than the profits. Power consumption should stay the same, so the miner will know exactly how much they will have to pay.
Another one of ASIC advantages is space efficiency. ASICs come as fairly small, standalone devices that can be plugged into a computer. As long as the PC has internet connection, that is all they need in order to start mining. This is another thing that makes this mining hardware better than GPUs. In comparison, GPUs and CPUs require a motherboard, a cooling system, and other components.
Disadvantages
However, ASICs have some disadvantages as well. As mentioned before, they can only be used for one cryptocurrency — the one they were made to mine. If you purchase an ASIC miner for Dogecoin, you will only be able to mine Dogecoin. If you also wish to mine Bitcoin, you would have to buy another ASIC.
Another disadvantage is the fact that ASICs bring the network closer to centralization. As mentioned, these devices are very costly, so usually, only wealthy miners can afford them. This often includes companies and mining farms. As a result, this could lead to only a small handful of users getting to mine a coin via ASICs, making the mining of that coin more centralized than decentralized.
What Are the Best ASIC Miners?
Since ASIC miners emerged, dozens of them were invented by various companies. The crypto mining field has become far more competitive than most people assume, and that includes mining gear. With that being said, we have selected a range of the ASIC miners we recommend.
The Most Popular Models of Bitmain Antminer
Arguably the most popular ASIC miner is the Bitmain Antminer 29 XP. Most consider it to be the best mining hardware for Bitcoin. It is more energy-efficient than most, and its price has also dropped over the years, so it is also affordable.
Speaking of Bitmain Antminers, there are multiple models, such as T9, S5, S7, and S19.
Bitmain Antminer T9 is an old model released in 2017. Originally, it was among the most expensive ones, but its hardware stability and chip quality were on another level compared to other models at the time.
Bitmain Antminer S5 is another older model, but it is affordable and it provides good value for the money. With its low power supply, it is energy-efficient, light and small so it doesn’t take up too much space.
The Bitmain Antminer S7 was one of the most energy-efficient models out there. As such, it is a very popular miner today. However, it is worth noting that its system is sensitive to the environment. As such, it might struggle if the temperature is above 80F/27C.
The last Bitmain model that we wanted to address is Bitmain Antminer S19. This one is the oldest mining system for Bitcoin. The system requires high voltage, but it has enough power to match the demand. Other than that, it is easy to set up, and it generates very low heat.
Other ASIC Miners to Consider
Another option is Parallel Miner’s Avalon 741. This is a miner that uses relatively new mining hardware. It uses the SHA-256 algorithm, meaning that its focus is on cryptos that are compatible with this algorithm. Avalon 741 is also effective for large-scale mining operations, and it is energy efficient. All of this also means that it can be quite profitable, depending on what coin you mine.
Another well-known name among ASIC users is MicroBT Whatsminer M30s++ 112T. This is one of the most powerful systems on the market. Its power is equal to 31 joules per Ths, which is something that not many miners can match. More than that, it is compatible with Bitcoin, as well as other SHA-256 crypto assets. It is among ASICs whose price is in the middle range. Even so, you will have to set aside $3,000-4,000 in order to purchase one.
What Does the Future Hold for ASIC Miners?
The Crypto space has come a long way since its inception all those years ago. As a result, it’s likely that the hardware used for mining will also advance in time. New technological developments are enriching the crypto industry all the time, and hardware will follow software.
As long as there are coins to mine, ASICs will stick around as the most powerful mining tools available. At least, they will remain if they don’t get replaced by some more powerful mining gear.
FAQs
What Is an Application-Specific Integrated Circuit (ASIC) Miner?
ASIC miner is a machine created for mining cryptocurrencies. Typically, each of these miners was set up to mine specific crypto. As such, Bitcoin ASIC miner can only be used for mining Bitcoin.
What Are the Applications for ASIC?
ASICs are devices that contain a massive amount of computing power. As such, they can be used in various fields and industries. Some examples may include research, data processing, medicine, satellites, and more.
Is ASIC a Processor?
An ASIC is essentially a chip that was custom-designed for a specific purpose. Its job is to process massive quantities of information at great speeds. As such, yes, ASIC miner can be considered a processor.
Which Crypto Can Be Mined by ASIC?
Miners primarily purchase ASIC miners in order to mine Bitcoin. However, a number of other PoW-using cryptocurrencies can be mined, as well. Some examples include Bitcoin Cash, Litecoin, Zcash, Dogecoin, and others.
How Much Does ASIC Mining Cost?
ASIC miners can cost anywhere between $400 and $12,000. The price differs depending on the type, power, brand, and other factors. Most ASIC miners are too expensive for an average miner to purchase, so they stick with GPUs.
Is ASIC Mining Better Than GPU?
ASIC miners have their advantages over GPUs, such as greater power and speed. However, they also have some downsides, like cost., and they only mine a single coin. GPUs, on the other hand, can be used to mine any coin whose difficulty is “in range.”
