An acronym for application-specific integrated circuit — a device designed for the sole purpose of mining cryptocurrencies.
What is an ASIC?
Application-specific integrated circuits (ASICs) can be thought of as “crypto mining machines.”
But by the mid-2010s, it had become impossible to conduct profitable mining operations using everyday devices because of limits on computing power and the costs associated with energy consumption.
ASICs tackle both these problems. They are designed solely for mining (and some ASICs are purpose built for mining specific cryptocurrencies) — and they can also be engineered to maximize computing power while keeping energy demands to a minimum.
Today, all large-scale crypto mining is conducted using ASICs, often in closely controlled data centers. They’re normally based in countries where power is relatively cheap.
There are several key factors that determine the potential profitability of a specific ASIC. They include:
1. The number of hashes the hardware can generate per second
2. The total hash rate across the network
3. The value of the coin being mined
4. Energy consumption per hash generated
5. The initial cost of the hardware itself
Dedicated directories such as ASIC Miner Value provide real-time league tables of the most efficient ASICs currently available. They also show the break-even point for each model of ASIC — that is, the time it will take for the ASIC to generate enough income to cover the cost of the hardware.
Popular ASIC manufacturers include Bitmain, Innosilicon, ASICminer, and MicroBT. The most efficient ASICs currently on the market can cost several thousand dollars.