What is Bitmain?

mining BTC or other cryptocurrencies requires hash power to solve the proof of work (PoW) algorithm. In the earliest days of cryptocurrencies, this hash power could be generated using general-purpose hardware such as CPUs or GPUs. However, as the Bitcoin network has grown, the mining difficulty has increased, so only specialist hardware, known as application-specific integrated circuits (ASICs), can generate the necessary hash power.

As of 2024, Bitmain dominates the global markets for the production and sale of ASICs worldwide.

History of Bitmain

Bitmain was founded in 2013 by Jihan Wu and Micree Zhan. Amid a bull market, Wu had decided that mining BTC would be more profitable than buying it but was unsatisfied with the quality of mining equipment on offer. He engaged his colleague Zhan in the technical task of building an efficient mining device, and the Antminer S1 was launched in November 2013.

The crash in BTC prices following the news of the Mt.Gox hack in 2014 had the effect of causing most of Bitmain’s competitors to pull out of the market. By the time the next bull market came around in 2017, the company was well-established as the most dominant manufacturer of Bitcoin mining equipment.

By this point, Bitmain claimed to control over three-quarters of Bitcoin ASIC sales and 85% of crypto ASIC miner sales. In the same year, the company closed a Series A round worth $50 million. The next year, it raised over $700 million in Series B funding with a valuation of $14.5 billion.

Around this time, the company also tried to launch an IPO on the Hong Kong stock exchange, which ultimately failed.

Between 2019 and 2021, Wu and Zhan were in a power struggle over control of the company, with Wu trying to oust Zhan publicly. However, in January 2021, Wu himself announced he was stepping back from the company, stating that the disagreement between himself and Zhan had been “finally settled in an amicable and, more importantly, a constructive manner.”

As part of the agreement, the company’s cloud mining subsidiary Bitdeer and the BTC.com mining pool were both spun out from Bitmain, and Wu took over both as Chairman. Both companies were later acquired by another company.

As of 2024, Micree Zhan still serves as the Bitmain CEO. The company is based in Singapore.

Bitmain products and operations

Bitmain operates several businesses that are predominantly focused on Bitcoin mining hardware and mining operations.

Bitmain mining equipment

Bitmain’s flagship product is the Antminer series of Bitcoin miners, which it has regularly updated over the years to handle the increasing hash power demands of the Bitcoin network as its difficulty algorithm continues to grow. Mining equipment has also become more efficient, consuming less energy per terahash due to improvements in chip capabilities and cooling technology.

The first edition of the Antminer, the S1, was released in 2013 with a hash rate of 180 gigahertz per second. Subsequent releases following a sequential number order until the most recent as of 2024, the S21, which operates at up to 473 terahertz per second for the highest specification model.

While the Antminer only supports Bitcoin’s SHA 256 algorithm, Bitmain also produces mining equipment based on other algorithms. For instance, the Litecoin miner supports the Scrypt algorithm, which can also be used to mine DOGE.

In September 2024, Bitmain announced the expansion of a partnership with Bitcoin mining company Hut 8. Under the new agreement, the firms will jointly launch a next-generation ASIC miner that features a liquid-to-chip cooling mechanism, making it more efficient and consuming less energy per terahash.

As of 2024, it’s estimated that Bitmain controls around 80% of the market for Bitcoin mining equipment worldwide. The company has come under criticism from some corners of the Bitcoin community for centralization with accusations of creating a dependency on a single firm for mining activities.

Antpool

Antpool is one of the largest Bitcoin mining pools globally. Mining pools allow groups of BTC miners to pool their equipment to stand a better chance of being selected to mine a block and thus increase revenues. As of 2024, it’s estimated that Antpool has mined around one-fifth of all BTC in the last three years.

Antpool’s leading position among mining pools has also led to criticism of Bitmain for centralization. At one time, when Bitmain also owned the BTC.com mining pool, it dominated more than 50% of the total hash power of the Bitcoin network.

Antpool also mines other coins that still use the proof of work algorithm, including Bitcoin Cash, Litecoin, and Ethereum Classic.

BitFuFu

BitFuFu is a cloud mining service, meaning users don’t need to own mining hardware to participate and can simply lease hash power via the cloud. Leases run for a fixed period ranging from a few days to a year. According to its website, BitFuFu operates 25 mining facilities worldwide and has over 395,000 registered users.

In 2021, BitFuFu became a strategic partner of Bitmain and subsequently took strategic funding. In March 2024, BitFuFu became listed on NASDAQ following a merger with Arisz Acquisition Corp, a Special Purpose Acquisition Company. However, the company is still considered a strategic partner of Bitmain.

AntSentry

AntSentry is a cloud-based mining operation monitoring and automation system. Miners can connect each of their mining devices to set alerts when the system detects issues or abnormal running conditions, monitor hash rates, carry out firmware upgrades, and schedule batch operations.

AntAlpha

AntAlpha is a lender for institutional mining operations. It enables Bitmain to harness its significant BTC holdings for lending purposes, so the interest can act as an additional revenue source. AntAlpha has developed a technology stack and user interface for institutions that can apply for credit and monitor open positions.

Bitmain essentials

• Bitmain is the world’s leading mining hardware manufacturer and operates several related businesses.
• The company was founded in 2013 and established market dominance with its Antminer series of Bitcoin miners, which may account for up to 80% of the total operational network.
• Bitmain also operates the Antpool mining pool, which accounts for around one-fifth of the BTC network hash power in 2024.