Bitcoin (BTC) mining has undergone significant changes over the years due to the increasing popularity of cryptocurrencies. Despite this growth, ASIC devices, which stands for application-specific integrated circuits, remain crucial for efficiency, speed, and energy in BTC mining.
Specifically designed for Bitcoin’s SHA-256 hashing algorithm, ASIC miners can perform hash calculations much more efficiently than general-purpose processors, contributing to mining success. The availability of ASIC devices commercially dates back to 2013, with Chinese Bitcoin pioneer Nangeng ‘NG’ Zhang often credited for releasing the first functioning Bitcoin ASIC miner to the public.
NG Zhang and his company, Canaan Inc., have made a significant impact on the Bitcoin mining ecosystem, even being listed on the Nasdaq Global Market. In an interview, NG Zhang shares insights on the dynamics of the Bitcoin mining industry and introduces Canaan’s upcoming home-friendly miners.
Cointelegraph: It has been a decade since you created the first blockchain mining-specific hardware known as ASICs. How do you view the evolution of the digital asset mining space over the past 10 years?
Nangeng Zhang: Over the past decade, the digital asset mining space has evolved in various ways. Hardware performance has seen significant improvements, with the latest A1566 exceeding 200,000 Ghs with improved energy efficiency. The ecosystem has also developed from a small community to a significant industry that cannot be ignored in the global monetary system.
Our customer base has expanded from tech enthusiasts to institutional investors and publicly listed companies. These changes over the years have been achieved without a centralized leader, showcasing the collective effort of everyone involved.
Cointelegraph: How did you come up with the idea of dedicated Bitcoin mining hardware? What inspired you to create the original Avalon series?
Nangeng Zhang: Bitcoin’s algorithm is well-suited for hardware implementation, and the move towards ASICs was likely one of Satoshi Nakamoto’s intentions. The transition to ASIC-based Bitcoin mining has brought security to the ecosystem, ensuring its stability for over a decade. In late 2012, I analyzed the situation and successfully completed the transition to ASIC dominance to prevent potential attacks on the Bitcoin blockchain.
Cointelegraph: What are the most significant differences between 2013 and 2024 in the mining industry and the overall crypto space?
Nangeng Zhang: The most significant change is the increased scale in the mining industry, requiring large investments and growing facility sizes. Despite this growth, decentralization has been maintained, preventing serious monopolization. We are also focused on promoting the development of the mining industry through environmentally friendly approaches like our home-friendly miner products.
Cointelegraph: Can you discuss the shifting dynamics between institutional mining and home mining and the factors driving these changes?
Nangeng Zhang: The barriers to entry in mining continue to rise, making it challenging for home mining to compete with institutional mining solely for profitability. Our approach to home mining involves designing new products tailored to home needs, emphasizing ease of use, fun, and practicality. These products not only provide heat but also contribute to blockchain security through hashrate output.
Cointelegraph: What strategies has Canaan implemented to maintain its edge in ASIC high-performance computing and Bitcoin mining technology?
Nangeng Zhang: Staying ahead in ASIC high-performance computing and Bitcoin mining technology requires significant research and development investment while meeting customer needs. We use advanced process technology for chip design and continuously innovate our products. We also focus on business model innovation, offering system solutions and facility operation services to customers.
Cointelegraph: You recently launched the Avalon Bitcoin Miner A1566. What are the key features of this product?
Nangeng Zhang: The Avalon Bitcoin Miner A1566 is our latest generation product with improved performance over time. The hashrate has increased to around 210 THs, with energy efficiency improving as well. The A15 series is durable and heat-resistant, with positive feedback from customers. We also offer water-cooled and oil-cooled versions to meet diverse market demands.
Cointelegraph: Can you introduce us to Canaan’s upcoming home miner and heater and how it will impact the home mining market?
Nangeng Zhang: Our upcoming Mini series is designed for home use, providing room heating with a maximum power of about 800W. These products incorporate mining functionality, contributing to the decentralized ecosystem while providing returns. We aim for home mining products to account for 20% of the overall mining market, enhancing Bitcoin network security.
Cointelegraph: How does Canaan plan to adapt to future industry trends, and what role do you see the company playing in shaping the future of Bitcoin mining?
Nangeng Zhang: In the future, as artificial intelligence advances, blockchain-based digital currencies may become the universal currency system. Computational demands from AI and blockchain mining will merge, creating a more complete ecosystem. Our efforts today will contribute to the advancement of civilization and the future of Bitcoin mining.