Bitcoin mining has been taking place since Bitcoin was first introduced in 2009. Here we look back at how Bitcoin mininers have evolved.
(a) PC-based mining (2009-2011)
In the early days of Bitcoin mining, no special computer was required, and it was done on a personal computer's CPU (Central Processing Unit, the brain of the computer). Anyone could easily mine using a commercially available computer.
However, as Bitcoin became more popular, more people started mining and competition intensified. The more people who used their computers to mine Bitcoin, the more computing power was put into mining, and the number of Bitcoins that could be mined by one computer decreased.
For approximately four years, from 2009, when Bitcoin was created, to 2012, every 10 minutes a block storing transaction data was verified and connected to the blockchain, and 50 BTC (as of March 2023, only 6.25 BTC are newly issued every 10 minutes. Why the amount of newly issued Bitcoin is decreasing is explained in detail in "Halving") was newly issued and distributed as a reward to the people running the computers that mine it.
However, the more computers that are involved in mining (solving mathematical problems to verify new transactions and receiving rewards) are added, the more computers have to share the same 50 BTC reward pie, so computers with less computing power are no longer able to receive much of a reward.
(b) GPU mining (2010)
Around 2011, more powerful computers became necessary to mine Bitcoin, and GPUs (Graphics Processing Units) began to be used for mining.
GPUs are usually used for image processing in computer games, but because they can perform complex calculations faster than ordinary PCs, they have also come to be used for Bitcoin mining. Because GPUs can mine much more efficiently than PC CPUs (mining with a GPU reportedly earned six times as much Bitcoin as a PC), people who used to mine with PCs were getting less and less reward.
(c) FPGA-based mining (since 2011)
Then, in 2011, the computing power of computers used to mine Bitcoins increased at an accelerating rate, and even GPUs were no longer able to mine as much Bitcoin. So, to further improve the efficiency and speed of mining, FPGAs (Field Programmable Gate Arrays) were used. FPGAs are programmable chips that specialize in specific calculations, and they were able to increase mining speed while consuming significantly less power than GPUs.
The difference between GPUs and FPGAs is that GPUs are designed to perform general-purpose calculations, while FPGAs provide a significant increase in computing power by configuring the hardware and software to solve specific computational problems.
While a GPU is like making a paper airplane from a single piece of paper, an FPGA is like a special piece of work that you put together for a specific purpose by combining the necessary Legos. A single piece of paper is useful because it can be used for many things, such as making origami cranes, writing notes, wiping dirt, and burning things, but if you try to make a paper airplane from a single piece of paper, it is difficult to make an airplane that looks like a real airplane.
GPUs are similar and can be used for a variety of purposes, such as creating computer images, but since they are not used solely for calculations to mine Bitcoin, their efficiency is inevitably low.
On the other hand, if you put together Lego blocks, you can make a plane that looks like the real thing. If the plane doesn't look good, you can rearrange the blocks to make a better looking plane. If you take the blocks apart, you can make a car or a house.
FPGAs are similar to this and are used in LCD panels, audio equipment, communication equipment, game consoles, memory cards, printers, LED display hardware, etc., but by changing the FPGA circuit, the same FPGA can be used for other purposes. Bitcoin mining is one of those uses.
(d) ASIC mining (since 2013)
Currently, the most efficient bitcoin mining hardware is the ASIC (Application-Specific Integrated Circuit). ASICs are semiconductor chips designed specifically for a specific computational problem, i.e., bitcoin mining, and have extremely high computing power and efficiency. However, on the other hand, because they are designed and manufactured only for bitcoin mining, the manufacturing costs of ASICs are high, and costs will not decrease unless they are mass-produced. The difference between FPGA and ASIC is that FPGA can be repurposed for purposes other than calculations for mining Bitcoin by changing the program, while ASIC is designed and manufactured only for calculations for mining Bitcoin. If FPGA is "an airplane made by combining the necessary Legos," ASIC can be imagined as "a custom-made airplane model." Legos can be taken apart to make cars and houses, but a "custom-made airplane model" cannot be taken apart to make a car or a house. Instead, compared to Legos, it can be made to look exactly like a real airplane, even in small details.
If you think about the purpose of "making an airplane model," a "custom-made airplane model" will be the best fit for your purpose, but a "custom-made airplane" model cannot be used for other purposes. If you disassemble it, it becomes just junk. ASIC bitcoin mining equipment is best suited for mining bitcoins, but it cannot be used for any other purpose. If you disassemble it, it basically becomes junk.
Building an airplane model out of Lego allows you to create a model that looks better than "building an airplane model," but it doesn't compare to a custom-made airplane model. Even so, even if you take Lego apart, it doesn't become junk, and you can build a house or a car. FPGAs can be used for purposes other than bitcoin mining by modifying the circuit in the same way.
A startup called Butterfly Lab was the first to announce plans to release this ASIC miner. However, Butterfly Lab was ultimately unable to release it to general mining companies, and in January 2013, Avalon, led by Yifu Guo, was the first to release an ASIC miner for general consumers and deliver it to customers. The performance (calculation speed) of this ASIC miner was 66GH (66 billion calculations per second), and the price of one unit was US$1,299. ( Source )
The first ASIC miner (although it was not the first due to delays in its commercial release) was Butterfly Lab's ASIC miner (exhibited by the Bitcoin Mining Museum at the Mining Disrupt 2024 conference held in Miami).
Avalon 1, the first commercially available ASIC miminer ( exhibited by the Bitcoin Mining Museum at the Mining Disrupt 2024 conference in Miami )
(e) The birth of Bitmain’s blockbuster ASIC miner “S9” and the subsequent evolution of ASIC mininers
Since the appearance of ASIC (Application Specific Integrated Circuit) miners in 2013, mining equipment has evolved rapidly, with advanced semiconductor process technologies being adopted one after another.Semiconductor process technology refers to the methods and techniques used to manufacture semiconductors, and by adopting advanced technology, it is possible to manufacture smaller semiconductor chips. The smaller the semiconductor chip, the faster it can perform calculations, and therefore the less power it consumes to perform the same calculation.
The unit of measurement used to express this process technology is "nanometers." The smaller this number is, the smaller and more efficient the semiconductor chip is.
Just as the semiconductor chips used in the smartphones that you all use are becoming increasingly finer, which improves performance and extends battery life, the smaller the semiconductors used in ASIC miners become, the better their performance will be.
The performance of Avalon, released in 2013, was 66 GHz (66 billion calculations per second), but since then, the evolution of semiconductor chips installed in ASIC miners has progressed rapidly. The more advanced semiconductor chips are adopted, the more efficient the ASIC miner becomes and at the same time, the less power it consumes.
2014 - Bitmain's AntMiner series: Bitmain released the AntMiner S3, which used a 28nm process and had a hash rate of 441GH/s (440 billion calculations per second).
2016 - Introduction of 16nm process technology: Bitmain released the AntMiner S9. This ASIC miner used 16nm process technology and had a hash rate of 14TH, which was much more efficient than previous miners. The AntMiner S9 was a big hit in the bitcoin mining industry. (Incidentally, we started mining on the S9 first.)
2019 and beyond - Adoption of even more advanced technologies: Bitmain's AntMiner S19 Pro adopts the new 7nm process technology and achieves a hash rate of 110TH/s.
