China Mining Co Bitmain Shows Higher 2017 Profits Than US GPU Giant Nvidia Report Finds

China Mining Co. Bitmain Shows Higher 2017 Profits Than US GPU Giant Nvidia, Report Finds

Chinese mining hardware giant Bitmain has reportedly

made higher profits in 2017 than long time American graphics processing unit (GPU) manufacturer Nvidia, CNBC reported Feb. 23. CNBC writes that according to a report published Feb. 21 from investment research company Bernstein, the four-year-old Bitmain reportedly made between $3 and $4 billion in operating profit in 2017, whereas Nvidia, founded 24 years ago, made about $3 billion during the same period.  

Bitmain, founded in 2013 by Jihan Wu and Micree Zhan, uses Application-Specific Integrated Circuit (ASIC) cards to mine Bitcoin (BTC), sells ASIC-powered AntMiner BTC mining rigs, and also operates “mining pools”, a system in which cryptocurrency miners share resources and split rewards. Nvidia-manufactured graphics cards reportedly tend to appeal more to “hobby miners”, who may choose to buy a conventional GPU, rather than investing in a more powerful and expensive ASIC-powered rig, like Bitmain’s AntMiner.

The Bernstein analysis reports that Bitmain holds 70 to 80 percent of the market for Bitcoin miners and ASIC cards, with most of the revenue made from selling the mining rigs, “and, to a much lesser extent, by collecting management fees from the mining pools it operates and renting out the mining power of its mining farms through cloud services." The rising price of BTC in 2017 especially has also contributed to Bitmain’s profits, for the Bernstein report writes that, "Bitmain shrewdly adjusts the prices of miners according to bitcoin prices."

When the price of BTC rose to $20,000 in December 2017, Bernstein reported that the price of Bitmain’s Antminer S9 hit almost $5000. The Taiwanese manufacturer TSMC that supplies ASIC chips to Bitmain had signed a deal with Samsung in late January of this year. The Bernstein analysts say that Bitmain’s dealings with TSMS “contributed 2 to 3 percent of the chipmaker's total revenue last year.” After China’s crackdown on the cryptocurrency industry within the country, including banning both Initial Coin Offerings (ICO) and foreign exchanges, Bitmain has attempted to circumvent regulations by opening mining farms in Canada and Switzerland, a mining pool subsidiary in Israel, and regional headquarter in Singapore, the Bernstein report notes. Bitmain’s "massive cash position" and the fact that it sells chips to miners, as opposed to mining itself, protects the company from slumps like those earlier this month, when BTC’s price dropped below $7000.

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German Research Institute To Use Blockchain For Radio-Frequency ID Sensor Systems

The Fraunhofer Institute for Photonic Microsystems (IPMS),

based in Dresden, Germany, intends to use Blockchain concepts for the development of wireless radio-frequency identification (RFID) sensor systems in the logistics sector, according to a Feb. 22 press release. The use of Blockchain solutions for the decentralized storage of data generated by RFID sensors could be made possible in this context through unique approaches to each client. Fraunhofer IPMS develops individual hardware and software solutions for its customers and analyzes their individual requirements using simulations.

Although Fraunhofer IPMS does not yet offer a finished product with Blockchain integration, they will present software solutions for wireless RFID sensor systems that can be extended with Blockchain technology at the Trade Fair for Intralogistics Solutions and Process Management (LogiMat). The event, which will take place between March 13-15, 2018 in Stuttgart, Germany, is the largest European trade fair for the logistics sector.

According to the institute’s press release, Fraunhofer IPMS sees great potential in using Blockchain technology for data management of supply chains in automation and logistics processes and says it could “speed up deliveries, avoid fraud and errors, and reduce scrap and costs.” Dr. Andreas Weder, team leader at Fraunhofer IPMS, said that storing the data generated by RFID sensor transponders on a Blockchain makes them reliably traceable for all participants in

the supply chain:

“Our passive RFID sensor transponders measure physical parameters such as humidity, vibration or temperature and transmit them wirelessly to a reader that also provides the energy.”

The German lobby group Blockchain Bundesverband had said earlier this month that the German government will create a legal framework for regulating Blockchain technologies in a move to “welcom[e] the Blockchain industry” to the country.

Chuck Reynolds

Marketing Dept
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