Sales of equipment for mining the premier cryptocurrency in the US could reach $20 billion over the next five years, according to estimates by Bernstein.
Bernstein says mining hardware is a $20 billion opportunity amid Trump’s push to ‘make bitcoin’ in the US https://t.co/vx9CfR2VID
— The Block (@TheBlock__) July 30, 2024
The impetus for these calculations came from statements by US presidential candidate Donald Trump regarding changes in digital asset policy should he be elected.
Historically, the mining equipment market has been dominated by Chinese companies like Bitmain, which holds over 80% of the market share.
The launch of new chips by Block and Auradine opens the possibility to diversify supply chains, compete for advanced chip design, and ensure access to global lithographic production capacities, Bernstein noted.
In July, the first of these companies reached agreements to supply Core Scientific with its new 3-nm ASICs with a hash rate of ~15 EH/s, which are more energy-efficient compared to current developments. Bernstein valued the deal at $300 million. Experts anticipate that this will not be the only deal for American bitcoin miners.
Supported by MARA, Auradine supplied Teraflux series AT1500 miners (22 J/TH) and announced new models AT2880 and AI3680. The 2800 series uses 3-nm ASIC chips with an efficiency of 14 J/TH.
In April, the company closed a Series B round at $80 million.
“We expect a 15-30% annual growth in demand for mining equipment, driven by an increase in network hash rate (supported by bitcoin price forecasts) and the replacement/upgrade of existing capacities. The latter is necessary to improve mining efficiency afterhalving. Based on current equipment prices, the potential revenue from hardware is ~$3-5 billion per year,” the specialists calculated.
Experts viewed Trump’s recent statements on bitcoin as a “tailwind” for local miners with “potential for improving fleet efficiency, reducing capital expenditures (by lowering chip prices), and reserve capacities for AI/HPC opportunities.”
“There is an opportunity for open-source innovation and customizable software, as well as close partnerships with American miners to enhance fleet efficiency,” the analysts explained.
Bernstein believes this is particularly applicable to Riot Platforms, CleanSpark, IREN, and Core Scientific, which are consolidating the industry.
Valentin Fournier from BRN noted the transition of miners to a new phase of coin accumulation to capitalize on potential market improvements.