It's long been hypothesized, and now broadly accepted, that should practical quantum computers arrive, they could eventually break the conventional cryptography methods that underpin today's digital world. Crucially, they might crack elliptic-curve cryptography (ECC), a principle in use today across many fields. The timeframe for the quantum cryptocalypse was previously believed to lie past 2030, but new research from Google pulls this schedule forward to 2029.

The paper predicts profound effects across blockchain infrastructure and cryptocurrencies, among other applications. The list of blockchains expected to be under fire from the quantum ECC attack is essentially "all of them," as demonstrated by a recent Cambridge study.

Although the potential for quantum attacks on ECC is wide-ranging, it's particularly troublesome for blockchain applications, as the participants' public keys and transaction data are by definition published worldwide and can therefore be stored for later cryptanalysis and attack. The fact that historical data is readily available is why blockchains (and cryptocurrencies by extension) are particularly vulnerable to quantum attacks.

At a technical level, the attack on ECC is called Shor's algorithm, published in 1994, when quantum computers were nothing but a fever dream. The recent development that led Google's researchers to sound the klaxons is the fact that they demonstrated that Shor's attack can be performed with systems comprising 1200 logical qubits and 90 million Toffoli gates, or under 1450 qubits and 70 million gates.

Those are exceedingly high figures compared to existing gear that caps out at 48 logical qubits, but those figures are expected to grow exponentially as the technology evolves in coming years. Ironically, the viability of Shor's algorithm against ECC relies on the key length, meaning it would be far harder to use against the now-deprecated RSA encryption scheme and its long 2048-bit-plus keys.

Should the blockchain networks not quickly adapt to what Google describes as an increasingly imminent threat, the resulting chaos from a quantum attacker is predicted to be swift and brutal: among other consequences, wallet funds could be stolen, identities could be impersonated (thus tilting the scale on transaction verifications), and ledgers' intrinsic integrity could no longer be trusted. The DeFi ecosystem and all its smart contracts will also be at risk, plus intrusions into that network will be harder to trace as all transactions will appear legitimate. With a cryptographically relevant quantum computer (CRQC) in play, the chain of trust is not just broken but smashed to pieces.

Google asserts that moving from ECC to Post-Quantum Encryption (PQC) while there is still time to do so is the most appropriate countermeasure, but the fact that blockchains are by definition distributed and don't have a central authority becomes the main implementation problem. Experts have long warned that these attacks aren't merely theoretical, and generally speaking, blockchains take their sweet time in adapting to changing conditions, arguably by design.

Three years is therefore a very short timeframe for an ecosystem that took seven years to turn Ethereum over to a proof-of-stake system (that is, coin staking enables transaction validation) instead of proof-of-work (miners validate transactions).

Rubbing salt on the wound, Bitcoin in particular is technologically ancient by today's standards. Its original design was indeed resistant to attack and did get some upgrades along the way, but many participants see the continuation of mining and the slow evolution of the platform as a feature rather than a bug. That may well be the network's undoing.

Blockchains aren't the only applications at risk, either. Applications like website key exchange, SSH, messaging applications are transitioning away from ECC to PQC, plus any attack still requires capturing the encrypted data to begin with. X.509 certificates, used for server authentication, are a tough nut to crack, since moving to PQC requires coordination from certificate issuers, root certification authorities, and browsers. Code signing is another pain point, with the technology available but not truly implemented at scale yet.

As ever in the cybersecurity world, legacy gear is particularly at risk. At some point, its encryption will be easily broken, plus any captured traffic from now-legacy hardware and applications will be ripe for slicing open. This is yet another reason why it's critical to keep computing gear updated, particularly but not only networking-related hardware and software.

The New York Stock Exchange (NYSE) is bullish on building out a new venue for 24/7, instantly-settled trading of stocks and ETFs in tokenized form, reports Bloomberg. The move is intended to modernize stock trading, and evolves from the current arguably outdated model of trading during roughly half the day, on weekdays and non-holidays only.

According to Michael Blaugrund of Intercontinental Exchange Inc (ICE), who owns the NYSE, the development illustrates the evolution "from trading floor, to electronic order-book, to blockchain." The modernized platform, set to arrive "later this year," reportedly leverages NYSE's Pillar buyer-seller matching engine and integrates it with a blockchain-based system.

Crucially, the architecture links with various networks, and the tokenized stocks match those of a conventional share, maintaining owners' rights to dividends and corporate governance. As expected, the shares are backed by U.S. dollars in stablecoin form.

Bloomberg states that ICE is also in discussions with the U.S. Securities and Exchange Commission for the go-ahead for the new platform, though the seemingly advanced stage of development could indicate that regulatory approval is predicted.

Having 24/7 share trading begets the ability to manage cash flow outside regular banking hours, and to that end, ICE is reportedly collaborating with Citigroup and the Bank of New York for implementing support for tokenized deposits. Having instant settlement puts the kibosh on the one-day delay of existing equity markets, too.

The conventional markets' limitation on trading hours and the implied restrictions have long been criticized by blockchain technology enthusiasts, and the argument could be made that the time restrictions never made sense once trading stopped being physical.

The digital revolution in finance seems to be going at a good clip now, though. NYSE's move comes in hot on the heels of Nasdaq, which last September asked the SEC for permission to trade tokenized versions of socks. The London Stock Exchange Group launched its digital private fund management platform that same month, and in December, J.P. Morgan launched a tokenized money market fund based on the Ethereum blockchain.

Remember Intel’s run at Bitcoin mining? In the span of a year that saw monkey JPEGs selling for six figures and Ethereum setting fire to GPUs, Intel quietly entered and exited the blockchain game. Its Blockcsale chips promised a clean, power-efficient future for Bitcoin mining. Then they vanished.

Now, those same chips are back. On September 2, nonprofit hardware collective 256 Foundation tweeted that it had received a delivery of 256,000 Intel BZM2 ASICs from Proto, the mining arm of Jack Dorsey’s Block, Inc., which previously pledged to offload leftover chips from its partnership with Intel. We spoke with the nonprofit for more details.

Intel’s abandoned mining silicon gets a second life

We covered the release of Blockscale and the Intel Bonanza Mine (BZM2) ASIC in detail back in 2022. Launched with a specialized architecture designed to specifically accelerate SHA-256 processing for Bitcoin mining at ultra-low voltage, the BZM2 was Intel’s second-generation chip of its kind.

At the time, Intel was courting industrial-scale miners with chip specs topping out at 580 GH/s and power efficiency of around 23 J/TH. Intel pitched the chip as a scalable building block, designed to be chained into 256-unit rigs capable of competing with Bitmain’s Antiminers. But the market moved fast, and Intel abruptly killed Blockscale a year later.

Now, two years after Intel pulled the plug on Blockscale, the chips are set to be repurposed for DIY rigs and open-hardware projects. According to 256 Foundation, the full batch represents roughly 76 PH/s of aggregate hash rate — assuming a conservative 0.3 TH/s per chip at 0.7 volts.

“We’ll be able to say more definitively what kinds of hash rate can be expected once we have some prototypes built and validated,” said 256’s founder, ‘Econalchemist,’ in an email to Tom’s Hardware. “At that voltage, the efficiency should be ~29 J/TH, with an output of ~0.3 TH/s.”

A hardware reset for open mining

Distribution is limited to four open-source hardware projects in the U.S., each receiving 54,000 chips. The recipients were selected from a small pool of developers who had reached out after the donation was first announced in January.

“Recipients had since January to express their interest,” Econalchemist said. “We had a total of four serious inquiries, and it was important to us that these chips be used to support open-source development.”

No official documentation was included in the donation, but one of the recipients is producing new open resources, including schematics and reference designs. 256 Foundation also plans to contribute its own open-source hardware alongside that effort. “Having these BZM2 chips is a big step toward the new era of innovation we see on the horizon,” said Econalchemist, “where end users get to inspect, modify, and run their hardware freely.”

The demand for these chips shows that there’s a clear want for change in how mining hardware is developed. Bitmain, which dominates the sector, has long operated a closed ecosystem with locked-down firmware and hardware designed to resist modification. The Foundation is hopeful that these chips will help move things in the opposite direction.

“Getting the BZM2 chips into the hands of open-source developers is a noteworthy milestone… this is a big step toward the new era of innovation we see on the horizon where end users get to inspect, modify, and run their hardware freely,” explains Econalchemist.

Not just for Bitcoin

New reports from the White House indicate that the Trump administration, specifically Howard Lutnick's Department of Commerce, has seemingly inexplicable designs to start putting statistics "on the blockchain." As to what data exactly might find its way to the blockchain, or what purpose that might serve, Lutnick failed to elaborate.

Gizmodo reports that Commerce Secretary Howard Lutnick told President Trump on Aug. 26 that his department "is going to start issuing its statistics on the blockchain because you are the crypto president, and we are going to put out GDP on the blockchain so people can use the blockchain for data distribution."

Lutnick added, "and then we’re going to make that available to the entire government so all of you can do it ... we’re just ironing out all the details so we can do it.”

You'd be forgiven for not remembering what the blockchain is. It was the hype train of choice before being briefly supplanted by the metaverse, and now it's barely managed to hitch its caboose to AI. For everyone else, just say it with me: The blockchain is an immutable, distributed ledger used to keep an ostensibly tamper-proof log of... stuff.

The most famous example of the blockchain in action is cryptocurrency, which is supposed to keep its users honest in the absence of a central regulator. Companies have been looking to find ways to apply the blockchain to non-cryptocurrency projects—and raising large amounts of money in the process—for the better part of a decade.

There has been some progress over the years. Kraken said in January that "blockchain adoption is accelerating across major sectors like finance, healthcare, and supply chain management." So-called Web3 proponents have also made blockchain adoption (among other things) a core part of what they view as the next generation of the internet.

Yet it's still unclear how blockchain-based solutions are superior to their predecessors. Even if the ultimate goal for most of these projects is to avoid centralized authority, the Department of Commerce is by definition a central authority, so that wouldn't apply here. Lutnick didn't offer any details; he merely drew the line between crypto and the blockchain.

Ubisoft has announced a new partnership with doublejump.tokyo for its upcoming NFT RPG, Champions Tactics: Grimoria Chronicles, doubling down with implementing NFTs in gaming, despite NFTs being an obvious market failure. This marks a continuation of its 'Quartz' NFT initiative established in 2021.

The new development from Ubisoft isn't too surprising. Back in November 2023, Ubisoft partnered with Immutable, another NFT-focused gaming company with a lineup of three existing NFT games. Since those games are all built around NFT ownership, it stands to reason that Ubisoft's planned games are Immutable and now Doublejump. Tokyo will also be centralized around NFT ownership.

This leaves Ubisoft's own NFT initiative, dubbed Quartz when it was announced in December 2021, in a strange place. Ubisoft claimed that Quartz remained active as underlying infrastructure at the time, but these partnerships would lead one to believe Ubisoft is instead leaning on Web3 partners for these needs.

At least, it would seem that Champions Tactics will be built upon doublejump.tokyo's backend rather than Ubisoft's.

Champions Tactics certainly...looks like a video game. If you've played any Free To Play card game for mobile devices or PC in the past five years, you've basically already played this. 

The provided gameplay trailer gives no information whatsoever on how NFTs are implemented within Champions Tactics, though presumably, Ubisoft's reported partnership with "double jump. Tokyo" will allow them to properly implement the blockchain in its most wasteful form into an RPG. Maybe the advertised "thousands of unique heroes" will correspond to NFTs.

In any case, tracing this story back to a June 3 doublejump.tokyo post reveals a bit more information, as well as a few official website, trailer, and Discord links. The most pertinent piece of information is that Champions Tactics will be using the "HOME Verse" blockchain, which is run by doublejump.tokyo, and certified by Oasys. Doublejump.tokyo is also partnered with the likes of Square, Bandai Namco, and Sega for their NFT gaming projects, none of which have experienced success.

A new bipartisan bill introduced by US lawmakers on Wednesday aims to completely outlaw government usage of any Chinese-linked blockchain tech — and even cryptocurrency. Besides a blanket-ban, the bill also calls for a pointed ban of any government dealings with iFinex — the parent company of Tether, the world's largest stablecoin cryptocurrency (by market cap).

The proposal, named The Creating Legal Accountability for Rogue Innovators and Technology (CLARITY) Act, is co-led by a bipartisan duo of U.S. Reps. Zach Nunn, R-Iowa, and Abigail Spanberger, D-N.J. There are already a number of crypto-related bills on the floor, some of which also include security concerns around China-based blockchain tech. In a statement provided to Coindesk, the lawmakers clarified that the CLARITY Act aims to ensure that foreign adversaries don't have any sort of backdoor access that could be used to access critical national security intelligence and American's private information.

Other targets of the bill include The Spartan Network, The Conflux Network, and Red Date Technology Co., the latter of which is the official architect behind China's national blockchain project and central bank digital currency (CBDC) development for the digital yuan.

Red Date specifically responded to the bill, clarifying that its blockchain tech (namely the BSN Spartan Network) is arranged towards traditional IT, not crypto (of course, there's also the problem that the world of IT is just as vulnerable to information-stealing back doors). The company also invited U.S. officials to look over their open-source code and, well... make their own conclusions.

The bill further proposes that the U.S. Secretary of the Treasury, Secretary of State, and the Director of National Intelligence develop a synchronized plan toward "preventing the risks posed by China's and other foreign adversaries' development of blockchain technologies."

Bitcoin mining is thriving in Russia, despite the international sanctions imposed on the country following its 2022 invasion of Ukraine. This upswing is due to an influx of mining machines from manufacturers like Bitmain and MicroBT, whose expansion is driven by a saturated U.S. market, reports CoinDesk.

Russia has held a dominant position in the global Bitcoin hash rate because of its cheap energy and cold climate, which makes it somewhat easier to cool down mining data centers. In addition, China's 2021 ban on crypto mining boosted Russia's hashrate even further, making it one of the world's largest mining industries. Now that the U.S. market is saturated with mining machines from Bitmain and MicroBT, more machines are shipping into Russia than to any other market, according to Ethan Vera, COO of Luxor Technologies.

Russia's booming mining industry stands out against its struggling economy, which has suffered under severe sanctions imposed by the West. These sanctions do not entirely prohibit involvement in the mining sector, although they present 'significant risks,' according to David Carlisle, vice president of policy and regulation at blockchain analytics firm Elliptic. Foreign mining companies cannot conduct business with sanctioned entities or make payments to state banks and companies, which makes it harder to set up data centers in the country. In addition, these companies also face potential reputational risks given the current geopolitical climate.

The rising price of Bitcoin, coupled with increased activity on the Bitcoin blockchain driven by projects like Ordinals, have created a favorable environment for mining. Some factors make Russia particularly more competitive when it comes to mining. Firstly, increased regulatory scrutiny and taxation in the U.S. and other countries made them less appealing for mining. Secondly, changes in Kazakhstan’s regulatory environment, limiting the amount of electricity available for Bitcoin mining, made some miners move away from Kazakhstan, possibly to Russia. Thirdly, energy costs in Russia are significantly lower than elsewhere. Current prices for installing machines at a colocation datacenter are between $0.05-$0.055 per kWh in Russia, significantly lower than U.S. prices around $0.08 per kWh.

Cryptocurrency Mining Group (CMG) suggests Russia will be the only country able to significantly accelerate hash rate growth due to these conditions.

Mining rig manufacturers like Bitmain and MicroBT are capitalizing on the opportunity presented by Russia's thriving sector. Both companies are purportedly expanding their presence in the Russian market, providing after-sales services such as maintenance and repairs to local miners, albeit without officially confirming it.

Despite geopolitical tensions and sanctions, Russian miners and their international clients remain undeterred. These sanctions may have even inadvertently boosted the Russian mining industry, offering an alternative revenue stream for power producers hit by the economic downturn and facilitating the conversion of Russian rubles to Bitcoin, which can be traded globally. Despite potential hesitation from European and U.S. miners, Chinese miners are keen to fill any voids, taking advantage of the thriving Russian market and China's close relations with Russia.

But the skies are not completely blue for the Russian mining sector as companies working in Russia or with Russian entities may be sanctioned by the U.S. government. 

Following the invasion of Ukraine, the U.S. government imposed sanctions on BitRiver, Russia's largest hosting provider and a key player in the mining industry, which was the first instance of a mining entity being targeted by U.S. sanctions. The aftermath of this decision has left companies, such as the retail-oriented Compass Mining, uncertain about how to manage their equipment. Obviously, doing business with a sanctioned entity like BitRiver presents considerable risks for companies.

AMD confirmed that Robot Cache, a digital storefront that allows gamers to sell used digital games with crypto or cache, is exiting beta after three years. In celebration, AMD is offering Wasteland 3 for free if you sign up with the platform.

Robot Cache is one of the most unique digital distributors you can find today that allows gamers to sell digital games after playing them. You could do this with physical copies of games twenty years ago, but it isn't as prevalent today as the world transitioned to digital game purchases.

Unlike other platforms such as Steam, GoG, or Epic Games, Robot Cache's success hinges on its ability to buy and sell games simultaneously. As advertised, gamers can buy games on the platform and sell them once they are done playing. According to the Robot Cache website, 70% of the funds go back to the developers and 25% to you when you sell a game on Robot Cache. 

The whole system operates on blockchain technology to track game purchases. When game purchases are made on the platform, ownership is recorded on the platform's blockchain to identify who owns what. This way, the blockchain will record the next person who owns it when that game is sold later.

Buying and selling can be accomplished with cash or the platform's home-brewed cryptocurrency called Iron. Iron is acquired by selling games on the platform, completing challenges, and playing with your friends. But it will also be mineable on PC hardware in the near future. According to one of the platform's videos from four years ago, the primary purpose of Iron is to secure and encrypt game purchases on the platform (alongside buying and selling games with the currency).

The platform has been in beta for the past three years, but we got word from AMD (who is a partner with Robot Cache) that the site is now considered a live release, even though the website still identifies itself as a "beta" release at the time of this writing. In commemoration, the platform is not only giving away Wasteland 3 but also providing up to 90% discounts on many of its games.

The platform has enormous potential, but it's anybody's guess if it will succeed. Nonetheless, it is a unique platform that can give players some extra savings.

Cryptomining companies that have successfully weathered the tumultuous crypto market to survive have had to adapt by radically changing their business models. The latest example of this is Hive Blockchain, which used to focus its huge GPU resources (about 38,000 graphics cards) on Ethereum mining, until about a year ago. Now that's changing. Hive has been working on a transformative project to create and run AI workloads for customers, aiming to create a significant new revenue stream by pivoting toward the latest trend in the computing industry. However, it retains some GPU horsepower to mine alt-coins and run other services, just in case.

We previously discussed the bleak post-Ethereum Merge landscape facing companies like Hive Blockchain and Hut 8 Mining, back in early May. Both companies had done well to repurpose their GPU farms and continue to be trading. We started to learn what kinds of new HPC businesses they (and their thousands of GPUs) were involved in.

A new report from CoinDesk adds some up-to-date information to the progress of Hive Blockchain, in the wake of the publishing of its latest financials. Interestingly, Hive execs note there are several reasons why people and organizations might favor its services over the likes of OpenAI, or traditional tech titans with AI and cloud offerings like Microsoft, Google, or Amazon.

Hive's reasons for choosing services instead of established tech titans:

• Access to a fleet of up to 38,000 GPUs for machine learning, AI compute workloads etc
• Service agreement promising to keep customer data private and away of public LLMs (large language models)
• Choice of rent as a service or a cloud business model
• Proven track record of six years as a data center builder and operator

Hive Blockchain is only part way through the business transformation. The company's net loss during fiscal 2023 was $236.4 million, or $2.85 loss per share, compared to a net income of $79.6 million, or $1.02 per share, in fiscal 2022. However, the drop in Bitcoin valuation was a major contributor to this swing (minus $182m), as was depreciation on equipment values. Hive still has ASICs dedicated to Bitcoin and has nearly $66m worth of this cryptocurrency on the balance sheet.

The Wall Street Journal recently gathered some quotes from other ex-crypto businesses transforming their offerings to develop new customers. One of the biggest contributors to this report was Satoshi Spain, which used to sell and lease mining rigs, and now helps its customer base find new opportunities.

Satoshi Spain's founder Alejandro Ibáñez de Pedro snappily summed up the AI compute business as "mining 2.0." The rest of the report indicates that smaller AI compute providers like ex-crypto mining companies can find a niche by offering services to universities, start-ups, and small developers who might want more privacy, or be too small for doing business with the big players. Also, it is important to realize that companies like OpenAI, Microsoft and Amazon are "sometimes near full capacity," according to the WSJ, and thus not interested in the smaller / niche users.

Though the switch from cryptocurrency mining to AI compute sounds simple and painless, it isn't. Some of the older GPUs that were useful for ETH mining are of little value in the AI compute business, and that means more investments will be needed to change tack. Moreover, the 'success story' of Hive Blockchain predicts only approximately $1 million in revenue from the running of its AI server business project on 500 GPUs for a whole year. Compared to its balance sheet, that's small potatoes.

Crypto mining infrastructure companies like Hive Blockchain and Hut 8 Mining are looking at profitable new opportunities for leveraging their considerable GPU-based computing power. Bloomberg reports that as opportunities and profits from crypto have ebbed away, these businesses have been lucky enough to be in line to catch another computational tidal wave — artificial intelligence (AI) computing.

It is estimated that the crypto mining industry invested $15B on GPUs with which to unearth blockchain-based tokens. Last September, the financial viability of a swathe of cryptomining businesses evaporated overnight.

Of course, we are talking about the event known as the Ethereum Merge, where this popular GPU-minable crypto currency switched from Proof-of-Work to Proof-of-Stake. At the time we celebrated, noting that millions of GPUs would become unshackled and perhaps find their way into the tender arms of a PC enthusiast or gamer. However, some miners have held on, having been less affected due to their Bitcoin mining activity, while looking for other crypto opportunities and hoping for a bounce or resurgence in the crypto economy. According to Bloomberg's report, the likes of Hive Blockchain and Hut 8 Mining are already raking in tens of millions of dollars thanks to their HPC service offerings and the burgeoning AI business.

In its talks with Hive Blockchain, Bloomberg heard that the company is hoping to hit $10M in revenue from HPC business by 2024, and foresees this income stream doubling the year after. Hive Blockchain is a sizable business that purchased $66M worth of GPUs from Nvidia in early 2021.

Hut 8 Mining seems to have been even more successful in partially transitioning from crypto to HPC services. Bloomberg's report suggests the firm has made nearly $17M from these operations in 2022, representing about 11% of overall revenue.

In some ways the example businesses above are lucky to have been able to continue, and therefore be around to catch the AI wave. The source report notes that Core Scientific, which was the largest public Bitcoin miner by computing power, didn't even make it to 2023 before going bankrupt.

Going forward, the crypto mining stalwarts will have to survive some serious competition from the likes of Microsoft Azure or Amazon Web Services (AWS) to successfully sell AI acceleration services. However, it is noted that the ex-mining outfits have some of the best GPU maintenance experience and strong histories of optimizing for energy management.

It's been just a year since Intel officially announced its Bitcoin-mining Blockscale ASICs, but today the company announced the end of life of its first-gen Blockscale 1000-series chips without announcing any follow-up generations of the chips. We spoke with Intel on the matter, and the company told Tom's Hardware that “As we prioritize our investments in IDM 2.0, we have end-of-lifed the Intel Blockscale 1000 Series ASIC while we continue to support our Blockscale customers.”

Intel's statement cites the company's tighter focus on its IDM 2.0 operations as the reason for ending the Blockscale ASICs, a frequent refrain in many of its statements as it has exited several businesses amid company-wide belt-tightening. We also asked Intel if it planned to exit the Bitcoin ASIC business entirely, but the company responded, "We continue to monitor market opportunities."

In the original announcement that the company would enter the blockchain market, then-graphics-chief Raja Koduri noted that the company had created a Custom Compute Group within the AXG graphics unit to support the Bitcoin ASICs and "additional emerging technology." However, Intel recently restructured the AXG group, and Koduri left the company shortly thereafter. We asked Intel about the fate of the Custom Compute Group, but it says it has no organizational changes to share at this time. 

Intel hasn't announced any next-gen Bitcoin mining products and its Blockscale ASIC landing pages are now all inactive, but its statement implies that it is leaving the door open for future opportunities if they arise. Intel's initial entry into the market for bitcoin-mining chips came at an inopportune time, as its chips finally became available right as Bitcoin valuations crashed at the end of the last crypto craze, and Intel's apparent exit from the market comes as Bitcoin is back on the upswing — it recently cleared $30,000 for the first time in nearly a year.

Intel's Bitcoin-mining chips initially came into the public eye under the Bonanza Mine codename it used for its R&D chips that were never commercialized, but the company later announced it would enter the blockchain market and summarily launched a second-gen model named 'Blockscale" to select large-scale mining companies like BLOCK, GRIID Infrastructure, and Argo Blockchain, among others.

Aside from exceptionally competitive performance relative to competing Bitcoin-mining chips, Blockscale's big value prop stemmed from the stability of Intel's chip-fabbing resources. Several large industrial mining companies signed large long-term deals for a steady supply of Blockscale ASICs, thus circumventing the volatility with the mostly China-based manufacturers that engaged in wild pricing manipulations based on Bitcoin valuations, were subject to tariffs, and suffered from supply disruptions and shortages, not to mention the increased costs of logistics and shipping from China.

Intel tells us that it will continue to serve its existing Boockscale customers, implying it will satisfy its existing long-term contracts. Intel's customers have until October 2023 to order new chips, and shipments will end in April 2024. Meanwhile, Intel has scrubbed nearly all of the landing and product pages for the Blockscale chips from its website.

Intel's latest move comes on the heels of a cost-cutting spree — the company sold off its server-building business last week, killed off its networking switch business, ended its 5G modems, wound down its Optane Memory production, jettisoned the company's drone business and sold its SSD storage unit to SK Hynix.

Intel's cost-cutting also applies to numerous other projects, as Intel has also shelved plans for a mega-lab in Oregon and canceled its planned development center in Haifa. The company has also trimmed some programs, like its RISC-V pathfinder program, and streamlined its data center graphics roadmap by axing the Rialto Bridge GPUs and delaying its Falcon Shores chips to 2025.

It's unclear it Intel will continue to make further cuts to its far-flung businesses, but it is clear that the company is committed to slimming down to increase its focus on its core competencies as it weathers some of the worst market conditions in decades, not to mention intense competition from multiple foes. 

Cryptocurrency mining company Hive Blockchain said this week it had begun to deploy 5800 Intel Blockscale accelerator-based BuzzMiner mining systems that it designed itself. To date, this is the first large-scale deployment of Intel-powered mining machines. Also, the company disclosed that it earned $3.15 million in December by lowering its power use and, therefore, the number of Bitcoins it mined, reports CoinDesk. 

Hive constantly optimizes its hardware to improve efficiency and lower power consumption. Late last year, the company ordered the production of 5800 Hive BuzzMiners — cryptocurrency mining machines that it designed itself based on Intel's Blockscale custom ASICs. So far, the company has received and installed 1423 of these machines and shipped 987 systems to Sweden, where they will be installed by January 15. The remaining systems will be tested and shipped by the end of the month. In addition, Hive plans to replace older ASIC and GPU-powered mining hardware with its own BuzzMiner machines. Meanwhile, Hive appears to be the largest buyer of Intel's Blockscale chips.

Also, the company recently procured 3570 Bitmain S19j Pro miners, 2050 of which have been installed already. 

Hive mined 213.8 Bitcoin in December using ASIC and GPU hardware, which equaled 113.2 Bitcoin Per Exahash. Meanwhile, the cryptocurrency mining company earned $3.15 million in income from its energy price hedging and grid balancing strategy. It essentially means that it did not mine when the demand for energy was high. Instead, it sold electricity back to the grid.  

An interesting fact is that Hive's production was down by about 20% month-over-month in December. Meanwhile, the company’s grid balancing strategy and selling electricity back to the grid more than offset declines in cryptocurrency mining.  

Cryptocurrency mining got significantly less profitable in recent quarters due to lower demand for Bitcoins and because it got harder to mine cryptocurrency, which is why Hive and its rivals must improve their efficiency to stay in business. 

"Our technical team has updated our software stack which monitors the vital statistics of our global fleet of ASIC miners," said Aydin Kilic, president & COO of Hive. "This allows us to have great insight and granularity into the performance of each machine, using bespoke API calls, as we carefully study the overall fleet efficiency (in Joules per Terahash), to ensure we are mining for maximum profitability during a Bitcoin bear market. We continue to strive for excellence, ensuring that as we scale our hashrate we also optimize our uptime, to ensure ideal Bitcoin output figures and leading the sector in performance."

The world of cryptocurrencies has seemingly gone on a massive diet through this bear market, as the number of active tokens has decreased by almost 1,000 - the biggest-ever annual decline, according to Statista. The reduction brought the number of active cryptocurrencies from its 2021 high of 10,397 down to a (still) overwhelming 9,310. Of course, there's more to the cryptocurrency world than Ethereum and Bitcoin; but that doesn't mean all projects are worthy of attention. 

2022 has been a challenging year for the cryptocurrency space. The entire market has been shaken to its core following the high-profile implosion of FTX (whose pieces are still being picked up) in a year of severe economic uncertainty. As a result, fear, uncertainty and doubt regarding the space are at an all-time high. This led the crypto market's capitalization to shrink by an astonishing 72% decline from its November 2021 high of $3 trillion to today's $850 billion.

It's interesting to note the explosion in the number of tradeable tokens from November 2021 through January 2022, which saw a jump of around 2,400 up to its 10,397 maximum. When the grass is green, everyone wants to set camp; the bull market exacerbated confidence and greed flourished. It's no coincidence that so many tokens, each with their own "project," launched while cryptocurrency prices were at their all-time highs. The decline in the number of tokens can mainly be attributed to one of two things: the token project failed to survive the crypto winter, following a marked reduction in investment volume from both users and entities; or it was merely a scam/rug pull coin that never meant to bridge any gaps between today and tomorrow.

Coingecko, which uses a different analysis method than Statista's source (CoinMarketCap), paints a much more explosive picture. It estimates 8,000 launched tokens throughout 2021, with only 59% of them carrying on to this day. 

Advocates of crypto are quick to compare cryptocurrency's cycles to that of other high-impact technologies, such as the events surrounding the dot-com bubble. Unfortunately, the potential for profits also led to frauds, scams, and economic blowouts during that time. The argument is that this is what's happening in crypto, with bull markets attracting all kinds of bad actors whose only objective is profit. However, the reverse is also true: bear markets reduce people's willingness to part with their money, which means there are fewer chances of these "projects" actually taking off. The macroeconomic picture and rocketing cost of living only amplify this effect, and, likely, advances in law enforcement's actions against blockchain-yielding criminals and chain analysis should give bad actors some sleepless nights.

Whether the future of crypto will only leave space for a few high-impact cryptocurrencies or a veritable field remains to be seen. For now, it seems that a culling is in effect. Hopefully, the blockchain space is up for rehabilitation.

The Decentralized Storage Alliance was born Tuesday — promising cooperation between major technology players to facilitate the transition between Web2 and Web3. The major thrust of this initiative, indicated by its name, is in evolving decentralized storage, driving awareness of this technology, and promoting its adoption. Major technology partners include AMD, Seagate, Ernst & Young, Protocol Labs, and the Filecoin Foundation.

AMD's role in the Web3 tech coven is leveraging its expertise in high-performance and adaptive processor technologies — combining CPUs, GPUs, FPGAs, Adaptive SoCs, and deep software integration. This expertise is expected to be instrumental in the future success of decentralized storage.

Seagate is a well-known provider of physical storage technology, and has been even before the days of Web1. Its solutions range from home users to businesses and even to the cloud providers (Web2), which this newer technology hopes to displace. It's wise for Seagate to get onboard and be a guiding member of this alliance from the beginning if — as expected — decentralized storage does take off one day.

Investments and accountancy firm Ernst & Young will take on the role of guiding and developing secure blockchain technology for storage, to benefit its customers. 

The above trio, alongside alliance founders Protocol Labs and the Filecoin Foundation, aim to set up a widely-adopted foundation for decentralized storage by embarking on the following tasks: 

• Developing standard specifications and reference architectures that address the unique needs of enterprise companies.
• Providing access to education materials, technical resources, and best practices.
• Improving the process of onboarding data to decentralized storage networks and making it easier for new data centers to onboard to the network.
• Enabling the creation of impactful Working Groups that solve specific issues with the transition to decentralized storage technologies and Web3.

Why would you be interested in decentralized storage? This storage technology promises a Web3 version of the cloud — offering great efficiency and robust security, as well as a "significantly lower" cost. Its decentralized nature means that uses of this storage tech aren't locked in to a provider — they will meet data sovereignty requirements, and will benefit from other advantages inherent in the blockchain.

Filecoin is the largest provider of this type of service: Filecoin says it hosts 240 PiB of data, which is approximately 65,000 Wikipedia's worth of data. Its customers number in the thousands, and include UC Berkeley, USC's Shoah Foundation, and the University of Utah. It seems like the Decentralized Storage Alliance is off to a good start.

Cryptocurrency exchange Binance was put into emergency mode this Thursday following a hack. The exchange was immediately on top of the event and issued a blog post today detailing the steps taken to mitigate it. All in all, the hackers got away with $110 million in the exchange's native cryptocurrency, $BNB. However, initial reports supported by blockchain analysis reported a much greater $570 million figure (you may still see some websites carrying that number). But a rapid response from Binance halted all transactions throughout the supposedly decentralized exchange. Currently, $7 million of the stolen funds are frozen and pending recovery.

The exploit targeted the cross-chain bridge between the BNB Beacon Chain (BEP2) and the BNB Smart Chain (BSC). Bridges are software applications that allow for two different blockchains to interact, locking certain assets from one chain and "minting" (creating) equivalent assets on the destination chain. Bridges have been the target of most high-level hacks in the cryptocurrency space due to the complexity of bridging disparate protocols at a single failure point. The FBI has even made a PSA on the matter.

According to the blog post, the attack occurred via a sophisticated forging of a low-level proof into a common library, enabling the hacker to mint 2 million units of $BNB without deploying any cryptocurrency to back up the exchange. After securing the 2M units, the hacker then diverted slices of the funds to other, decentralized bridging protocols with the intent of "laundering" the 2M units into different cryptocurrencies. The attacker successfully converted the equivalent of $57 million to the Fantom blockchain protocol and its native token, another $53 million to Ethereum, and $400K to Polygon.

The Binance blog post asked Binance's stakeholders - essentially, anyone holding $BNB - to participate in a series of polls to allow for a community-based decision on the next steps. These governance votes, which will happen on-chain, will decide whether the hacked funds should remain frozen (it's unclear what repercussions this could have on users) or not. Additionally, Binance will be holding a vote on creating a bug bounty reward system - something that most blockchains already feature and which has led to numerous "white hat" exploitations that saw funds being siphoned and returned in exchange for sometimes million-dollar bounties.

One of the promises of blockchain technology, and cryptocurrencies, in particular, is decentralization. This is achieved by having as many users as possible carrying a copy of the blockchain proper, which ensures that there's always a way to find a true version of the transaction history. In most blockchains, however, validators aren't done by the average cryptocurrency user but by trusted nodes. These nodes have been given the power to participate in transaction recording and in securing the blockchain from a 51% attack (where anyone controlling half of the validators can create his own artificial transactions and enforce them on the blockchain with finality).

But decentralization means that no single player can alter or even halt the writing on the public ledgers that constitute any and all blockchains. The Binance Chain, on the other hand, was forced to show its centralized hand in that it managed to contact all 26 validators (44 in total across different time zones), alerting them to the theft and stopping new transaction blocks from being created. This may have stemmed the bleeding and prevented the stolen funds from actually leaving the chain. Still, it has undoubtedly caused stress to users, who were unable to do anything with their funds until the chain was restarted, which happened earlier today.

It also raises the question of future halts in the BNB chain and what that could mean for users' funds in the event of a more severe misstep.

While there are risks regarding centralization, the case can also be made for the impact of Binance electing not to halt its chain. With two million additional units of the BNB coin appearing out of thin air, the price of each $BNB itself would necessarily drop to account for the increased number of assets. If this drop were severe enough, and with the chain operating normally, users might panic into selling their own BNB tokens before the price descended further. This, in turn, could generate a fire sale, with prices plummeting even as buyers failed to absorb the mountains of BNB being put back into the market after the sought-after liquidity. Once this cycle starts, it's exceedingly difficult to stop it. Several stock-traded companies and blockchains have seen these events unfold, mostly with catastrophic effects.

Following news of the exploit, and perhaps somewhat upheld by the impossibility of actually selling assets, the BNB token only saw a 3.35% decrease in value. We'll have to wait and see what Binance's community decides on this - but at least for now, a crisis seems to have been averted.

In the early hours of today, September 15, 2022, the Ethereum community stood breathless. At 2:43 AM EST, there were over 41,000 people viewing an "Ethereum Mainnet Merge Viewing Party" via YouTube. The reason: a software upgrade to the Ethereum Virtual Machine (EVM), known as The Merge, the second most important event in Ethereum's history barring its creation. After the first validator node was successfully brought online (with more following suit), Ethereum's Proof-of-Work (PoW) ceased, replaced with Proof-of-Stake (PoS). Gamers and GPUs rejoice!

The Ethereum Merge has been a long time coming ever since its proposal (in December 2020) as a possible upgrade to Ethereum. The Merge's main feature is to enable Ethereum to transition from the energy-intensive PoW method to the far less demanding PoS. In PoW, validators/miners employed the best graphics cards and perhaps a few ASICs to crunch the cryptocurrency's Dagger-Hashimoto algorithm, securing the blockchain in the process and ensuring transactions are processed correctly.

PoS does away with the computationally intensive security method. Instead, validators will have to show they have a stake in Ethereum's future by holding the equivalent of 32 ETH (~$50,615 at time of writing) in their node. Holding these 32 ETH units theoretically means that these validators have Ethereum's well-being on their minds, since working against it or "poisoning" transactions would likely eat into Ethereum's market perception and value, in turn reduce the value of their staked Ethereum tokens.

One concern that's been raised against the new PoS method is that centralized exchanges can participate in the staking process: users will be able to stake their ETH directly with services such as Coinbase. This has raised questions regarding the true decentralization of Ethereum. Institutions and law enforcement having greater power over centralized exchanges than they do on individual/organized miners has been one of the Merge's discussed aspects. Lido, a community-run validator collective, controls over 30% of the stake on Ethereum’s PoS chain. Coinbase, Kraken and Binance — three of the largest crypto exchanges — own another 30% of the network’s stake. That reads as a few key players being trusted with the keys to the kingdom.

That said, Ethereum's $60 billion ecosystem of cryptocurrency exchanges, lending companies, non-fungible token (NFT) marketplaces, and other apps are now supposedly more secure and scalable.

Perhaps more important for our readers and PC enthusiasts (granted, some of which likely did plenty of mining), The Merge and the PoS transition finally put an end to GPU mining on the Ethereum network, which has been online since July 2015. Speculation prior to The Merge was that this would lead to a flood of used graphics cards from AMD's RX 6000-series and Nvidia's RTX 30-series hitting secondary markets. The result is that graphics cards that are already selling at a discount, such as the $680 RX 6900 XT, could fall even further.

Until yesterday, the Ethereum network counted around 900 TH/s of primarily GPU-driven computing power. That's the equivalent of roughly 9.5 million RTX 3080 cards, but more likely a large mix of slower and older GPUs were also participating — meaning there was probably closer to 20 million GPUs involved with Ethereum mining, give or take. This doesn't necessarily mean that a mix of 20 million cards are going to suddenly hit the market, of course. If miners do choose to offload their graphics cards, though, Nvidia and AMD could see some difficulty in selling new graphics cards at retail.

At least some graphics cards have been put to work on alternate mining cryptocurrencies such as Ethereum Classic (whose hash rate has already doubled since The Merge, up to 158 Terahashes per second) and Ravencoin (also almost doubling from 8.9 TH/s up to 15,9 TH/s). But the more miners turn to these coins, the higher the mining difficulty imposed by the network, which will drive profits down. Cryptocurrencies using PoW generally follow a formula that adjusts the difficulty of the algorithm to control the flow of new coins into circulation. This means more people are competing for a limited resource, and if price doesn't surge in lockstep with hash rates, the profitability of mining will plummet.

Above, you can see the data from NiceHash's Mining Hardware page, which is still based on the pre-Merge values. We ran some quick tests, using NiceHashMiner (and NiceHash's QuickMiner) to see where things stand right now. Prior to The Merge, a GPU like the RTX 3090 could gross around $2.80 per day and the RTX 3080 sat around $2.30 per day, almost entirely thanks to Ethereum mining. Now? Oh boy, how things have changed.

An RTX 3090 running NiceHash Miner decided Autolykos with the most profitable choice for mining. At 245 MH/s, it was bringing in BTC equivalent to around $0.65 per day, while the PC consumed 400W (about 330W from the GPU). Ethereum Classic meanwhile ran at 120 MH/s and consumed the same 330W, potentially bringing in $0.33 per day. At a baseline estimate of $0.10 per kWh, that's $0.80 in power used by the GPU per day, and $0.96 for the entire PC, meaning every coin right now is well into the unprofitable range with NiceHash.

Here's the full set of NiceHash Miner benchmarks for the RTX 3090, running the latest version 3.1.0.0 of the software. The GPU was tuned for memory intensive workloads like Ethereum, however, so these results should only be taken as a rough baseline of what could be achieved.

What about direct mining? WhatToMine's RTX 3090 data suggests you could gross up to $1.35 per day with mining Ergo (ERG) mining, which uses the Autolykos algorithm. GPU power might be tunable to as little as 260W, which means you could potentially net $0.70 per day. That's still far less than half of what the RTX 3090 was doing prior to The Merge, and it remains to be seen if any coin can emerge from the collective with sustainable mining profitability on GPUs in a post-Ethereum world.

The abandonment of GPU mining also means that Ethereum is improving its energy efficiency by leaps and bounds. Since graphics cards no longer need to run complex computations to power and secure the network, Ethereum's energy consumption footprint (and carbon footprint) has been reduced by 99.9%, simultaneously cutting worldwide power consumption by 0.2% (which is still much less than the worldwide energy consumption of electronics left on standby, by the way).

Interestingly, no price-action occurred for Ethereum post-Merge, positive or negative. That's partly because most exchanges put a freeze on Ethereum trading while waiting for the network transition to take place. It's also possible that speculation had already made its way into the pricing over the past few weeks, especially since the last successful testnet for the Merge, Goerli, occurred little more than a month ago.

While the main Ethereum network has done away with GPU mining, existing communities of miners may still attempt to keep their cash-cow running. Several proposals to copy the Ethereum blockchain while keeping mining capability (also known as a hard fork of the network, which we've seen happen with Ethereum Classic) have gained some ground within the mining community. Making a new coin based on an existing coin isn't difficult; the real problem will be convincing the cryptocurrency users of the utility of such a coin, to give it some perceived value.

A joint effort by the US government and blockchain firm Chainalysis has resulted in the recovery of around $30 million in stolen cryptocurrencies. The effort showcases that crypto can and will be subject to greater scrutiny and concerted investigative efforts between the government and private institutions. Advancements in blockchain analysis are key to increasing security in a field that has already seen $1.3 billion hacked away by bad actors in 2022 alone.

According to Chainalysis, 30$ million was recovered from the prominent hacking squad Lazarus, which is thought to operate with the North Korean government's blessing (the US specifically says the group acts under North Korea's Reconnaissance General Bureau). The recovered funds were part of the $625 million siphoned from popular NFT game Axie Infinity, whose Ronin sidechain was hacked earlier this year. Adjusting for the cryptocurrency price downtrend since the hack, the recovered $30 million only amounts to 12% of the stolen crypto assets. 

The senior director of investigations at Chainalysis, Erin Plante, said the seizure demonstrates that "it is becoming more difficult for bad actors to successfully cash out their ill-gotten crypto gains. We have proven that with the right blockchain analysis tools, world-class investigators and compliance professionals can collaborate to stop even the most sophisticated hackers and launderers."

In the process, Chainalysis helped investigators read the blockchain to follow the money across several obfuscation techniques. The company said that Lazarus' money laundering scheme used more than 12,000 unique crypto addresses across several crypto assets. Cryptocurrency mixers (which aggregate funds to make them fungible, i.e., indistinguishable) such as the recently sanctioned Tornado Cash app (which resulted in the detention of one of its lead programmers, Alexey Pertsev) were also used, as were several cryptocurrency bridges that further served to obfuscate the stolen funds across multiple cryptocurrencies.

The partial recovery is, of course, less than ideal. But even so, the increasing numbers of government and law enforcement cryptocurrency and NFT seizures show that even decentralized technologies are subject to centralized choke points. This is where checks and balances can be put into effect.

Sky Mavis, developers of Axis Infinity and the Ronin sidechain, took to Twitter to announce the seizure, expecting the stolen funds to be returned to the treasury "after some time." The company recently partnered with Google Cloud as a validator node for its Ronin sidechain, with Google becoming an independent enterprise validator for Ronin in a node pool. The firm will take on the role of monitoring validator uptimes and contribute to the collective security of the network. It's an interesting take — Sky Mavis thus takes advantage of Google's cybersecurity expertise, adding a (hopefully) incorruptible node to its relatively limited pool of validators, which was the principal reason why the initial attack ever took place.

The FBI issued a Public Service Announcement (PSA) regarding increasingly concentrated cybercriminal activity surrounding the DeFi (Decentralized Finance) landscape. The FBI cautions investors to do their due diligence in choosing what DeFi protocols they decide to engage with, citing particular vulnerabilities from their (frequent) open-source nature. While transparent, open-source opens up the book on eventual security vulnerabilities that cybercriminals can explore. Due to the amount of money being moved through Decentralized Exchanges (DEX), which in 2021 moved around $1 trillion, there's a huge appetite for exploits.

The FBI's numbers are staggering. According to the service, an estimated $1.3 billion have already been hacked away from the cryptocurrency market, with 97% of that value taken from the DeFi sector between January and March this year. The FBI estimates this to correspond to an increase of 72% over the same period last year, and a 30% increase over 2020. According to public data, over $4 billion were siphoned from the crypto space throughout the entirety of 2021. The service also explicitly points to wormholes — services that bridge disparate blockchains together — as preferred points of attack. Recently, one such service, Ronin, was hacked for $625 million.

A territory of cryptocurrencies, DeFi has several tiers of decentralization, spanning truly decentralized services (where no singular institution has control of funds or private keys) through less-centralized versions of it (recall the events surrounding the Celsius DEX). All of them operate through smart contracts, digital automations that define rules for swaps, purchases, transmissions of ownership, and essentially everything that happens in the blockchain space.

Due to the complexity of programming, however, sometimes bugs slip through the code. This also sometimes happens due to poor code audits and validations. The FBI has thus included in its recommendations that investors make sure that the DeFi service they're considering using has run through independent code audits. While this isn't a guarantee that they can't or won't be hacked, it does in theory increase the bar that hackers have to jump through to access users' funds.

Poor code typically has bugs that bad actors can leverage to siphon funds from exchanges. This siphoning can occur via an actual transfer of funds from the DEX to criminal-controlled wallets, or by minting (creating) legitimate tokens out of thin air. (These tokens aren't "real" tokens, such as an Ethereum (ETH) or Bitcoin (BTC) unit, but exchange-specific representations of that token, which are valued the same as their original counterparts). When these tokens are created, they're recognized as valid and are thus worth exactly the same as legitimate ones, even though they're in fact worthless.

This originates two tiers of concern. First, the value of all equivalent tokens in circulation decreases (because there are more of them circulating). Second, they can be exchanged for the actual cryptocurrencies they represent (such as BTC or ETH). These cryptocurrencies are usually deposited into exchanges by investors and serve as collateral for their DEX activities.

When these funds are exchanged and moved to a criminal wallet, the game is mostly over. Due to the blockchain's irreversibility, all trades are final. These actions can bring exchanges to their knees, since they no longer own the cryptocurrency assets deposited by investors, and thus can't return them at their request, generating liquidity crises, "bank runs", and leaving investors' funds stranded.

Cybercriminals take a number of steps to hide their activities, including tumblers (smart-contracts that eliminate cryptocurrency trails by pooling funds sent to it, obfuscating provenance and the general traceability of all cryptocurrency transactions). The Tornado.cash service was one of them (its coder has since been arrested). Another, more ingenious (and destructive) method is for hackers to simply paste their exploit code in an open database. Then others, who generally wouldn't have the know-how to explore vulnerabilities themselves, can simply copy and paste this code and take part in the looting. Here, chaos serves as cover.

Takeaway

The FBI clearly considers the cryptocurrency space a source of concern, with hacks from bad actors impacting a large number of users (i.e. investors) with each successful extrication of funds. It falls to users to perform their due diligence in choosing which exchanges to interact with and where they'll deposit their investments. Looking for exchanges that have adequate transparency, that are actually decentralized, that have performed independent code audits, and that have a history of strong coding and event response are paramount for investors to accurately gauge how risky their investment is. Easier said than done.

At the same time, the responsibility doesn't lay solely with investors. The FBI urges exchanges to perform the same steps that they're asking users to be aware of. They should perform independent code audits, manage real-time on-chain analytics, and create timely response plans that can effectively communicate with investors.

Ultimately, users also choose with their wallets which DeFi platforms rise to prominence. The more informed their decisions are, the smarter their investment allocation, and the lower the risk.

Bitcoin and cryptocurrency traders, in general, have woken to red lines throughout, as Bitcoin has followed the general trading markets in its significant 9.3% fall to three-week lows of $21,400. It marks the sharpest decline over two months as expectations of a hawkish fed and more aggressive moves against inflation have reduced investor confidence.

Markets are swift to respond to changes in monetary policy. The tentative recovery in stocks and the crypto market following the May-June crash stood on the market’s confidence that they’d already priced-in interest rate hikes throughout 2022. Allied with expectations that inflation would be curbed soon enough that 2023 might see a reversal in the hiked rates - with a controlled return to normalcy - primed the stage for a gradual recovery. 

Between May 5th and June 19th, Bitcoin dropped by over 50%, from a high of $39,676 to a bottom of $18,958 by June 19th. In the meantime, Bitcoin has (more or less) steadily gained ground, hovering around the $24,000 mark since the end of July.

That recovery is now in shambles.

According to data from Coinglass, today’s downturn led to Bitcoin traders losing an estimated $600 million in liquidations in the last 24 hours. Liquidation is one process through which traders’ positions are closed. It usually happens when they overcommit their funds, borrowing assets against their Bitcoin. The issue occurs when Bitcoin’s price falls more than the traders foresaw, which can mean that they no longer have the funds to guarantee their positions, thus triggering a liquidation event where their guarantee (Bitcoin) is taken to pay their debt.

Expectations of the Fed increasing interest rates more than previously thought - and increased risks of a continued quantitative tightening through 2023 - means that The Fear and Greed Index for Bitcoin now stands at 33 points - 8 less than the 42 of the previous week. Lower numbers indicate increased fear, while higher numbers correlate to increased greed (and more aggressive investments).

Bitcoin may be the leading currency by market cap, but the cryptocurrency market is much bigger than it. The number-two cryptocurrency, Ethereum, has been riding a wave of excitement and increased valuation due to the impending conclusion of its next upgrade, a process dubbed The Merge, which fell by 9%.

Other promising cryptocurrencies such as Algorand fell as much as 10.5%, while less-known altcoins such as Filecoin’s FIL token led the fall by an eye-opening 18.5%. Flow, the cryptocurrency recently partnered with tech giant Meta, is down by 17%. Ethereum Classic’s ETC token considered an alternative to Ethereum that might still enable GPU mining for a second lease of life, fell 15%.

How and when the market will readjust is anyone’s guess and primarily depends on investor sentiment and due diligence. However, with inflation still running free and doubts being cast on how changes in monetary policy are contributing to lowering inflation rates, it pays to be cautious, never investing more than one can lose.

The top three Bitcoin mining companies being traded on the US stock market lost more than $1 billion in the second quarter of 2022, according to a report from Bloomberg. The losses, which were matched by those of the crypto exchanges miners rely on to bring their funds into the real world, came after the collapse of cryptocurrency prices, which led to the value of the companies’ holdings being written down.

The three companies, Core Scientific Inc., Marathon Digital Holdings Inc. and Riot Blockchain Inc., posted quarterly earnings reports that show losses of $862 million, $192 million and $366 million, respectively. Elsewhere, the US crypto exchange Coinbase Global registered a loss of $1.1 billion in the same period, while major Bitcoin investor Microstrategy Inc. also lost more than $1 billion.

The cause seems to be the drop in cryptocurrency prices as miners sold off their coins to cover their costs and fund expansion, as well as repay their debts, and this appears to be continuing into the third quarter of the year despite signs prices were rising again.. July saw the second highest Bitcoin sales of the year so far, with 6,200 coins sold. This follows a June in which 14,600 coins were sold, though only 3,900 were produced, according to figures from Arcane Crypto. Core Scientific is thought to have sold 80% of its holdings.

At the same time, the big mining concerns are taking out loans, with Marathon Digital taking out $100 million (and selling off mining rigs to raise a further $58 million) and Core Scientific going for a $100 million common stock purchase agreement with a private equity firm.

Bitcoin remains profitable for large-scale commercial operations, with each block solved currently worth 6.25BTC, or roughly $120,000 at today’s prices. Energy consumption remains one of the major costs, with US electricity costs rising 12.6% in the last year. The price of the ASICs used to mine the coins has dropped, according to figures from Forbes, by up to 70% this year. As prices fluctuate, less efficient miners tend to give up, leaving the market in the hands of those with higher-performance mining equipment.

Mining profitability, measured in dollars per terahash per second, peaked in 2017 at $3.39/TH/s. Today it sits at around ten cents/TH/s, having been at 41 cents in 2021.

The hammer has struck: Celsius Network, a New Jersey-based crypto lending services provider, announced on Wednesday that it has filed for Chapter 11 bankruptcy. After a series of descending cryptocurrency price swings that saw the crypto market bleed around 60% of its valuation in six months - and a number of miscalculated risks - the provider says its bankruptcy filing aims to enable a "comprehensive restructuring plan" to the benefit of "all stakeholders". As is often the case, shark and whale lenders have started feeding on the bloodbath before other, less leveraged investors do.

According to the filing in the US Bankruptcy Court for the Southern District of New York, Celsius estimated its assets and liabilities to be in the range of $1 billion to $10 billion. The bankruptcy filing comes after the Decentralized Finance (DeFi) player froze all withdrawals, swaps, and transfers on its platform "to stabilize its business and protect its customers" on June 12. Interestingly, Celsius took much longer to freeze deposits, which led to some users' funds being pulled towards its financial black hole after the freeze took place.

Celsius Mining, the company's cryptocurrency mining unit that announced intentions of undergoing an Initial Public Offering (IPO) as early as March this year filed for bankruptcy as well.

According to the court documents, and after a series of high-profile payments to other crypto lenders, Celsius currently has  approximately $167 million in liquidity against the $4,153,380,951.91 its 1.7 million customers originally deposited. And just this Monday, July 12, Vermont's Department of Financial Regulation said Celsius Network was "deeply insolvent and lacks the assets and liquidity to honor its obligations to account holders." The writing was on the wall.

Laura Shin, a crypto journalist and podcaster who wrote The Cryptopians, a book analyzing the emergence days of crypto - and Ethereum in particular - told the Washington Post that Celsius "engaged in risky strategies for generating yield on their depositor's funds." Celsius' claim to fame rested on returns that could sometimes soar above 18% - just for users depositing (in crypto world, staking) their tokens with the service.

A former Celsius employee and CEO of DeFi firm KeyFi, Jason Stone, has already moved with a lawsuit against the company, accusing it of facilitating a Ponzi scheme that aimed to - and succeeded in - manipulating the cryptocurrency market.

Celsius has separately issued motions with the New York court asking for it to be allowed to continue operating "in the normal course", in order to bring in the profits that would allow it to pay employees and continue benefits.

Celsius represents a pervasive problem in the crypto industry, where financial services that claim to be decentralized (it's in the name) are actually centralized entities, with the power to control the flow of crypto assets.

Meta’s Novi money-transfer service users have received messages informing them of the platform’s imminent demise, with the pilot project’s experimental subjects becoming unable to add money to their accounts after July 21. According to reporting from Bloomberg, they should withdraw their funds and download their transaction histories, if needed, as soon as possible before the service is closed down on September 1.

The message on the Novi website is certainly unequivocal: “The Novi pilot is ending soon” after just 11 months in service. For those not deeply entrenched in Web3 lore, Novi is the smoldering remnant of the project that used to be Diem, and also was once Libra before having to change its name following a legal challenge.

The original plan for Libra was for it to be a stablecoin, backed by other currencies and US treasury securities to avoid the volatility that has seen certain other cryptocurrencies soar and crash. The last gasp of Novi was as a money transfer service baked into Facebook Messenger and WhatsApp that used the currency’s digital wallet technology to facilitate its transfers. Even then, it was only available in parts of the US and Guatemala.

The pilot seems to have been something of a beta test, with a Meta spokesperson confirming to Bloomberg in an email that the underlying tech would be used in future Meta products. “We are already leveraging the years spent on building capabilities for Meta overall on blockchain and introducing new products, such as digital collectibles,” Meta said in the statement. “You can expect to see more from us in the Web3 space because we are very optimistic about the value these technologies can bring to people and businesses in the metaverse.”

Rather than using Diem, Novi provided transactions in the Paxos Dollar stablecoin, while Coinbase Global Inc safeguarded the funds. All of Diem’s assets were sold in January, with Silvergate Bank reportedly buying up its IP, while the leader of the project quit in November 2021. Financial regulators had been extremely interested in the goings-on. “Despite giving us positive substantive feedback on the design of the network, it nevertheless became clear from our dialogue with federal regulators that the project could not move ahead,” Diem CEO Stuart Levey said in a statement given to CNBC at the time of the Silvergate sale. 

The state of New York has doubled down on energy-guzzling cryptocurrency mining farms. Last month, a bill passed by the state Assembly that directly targets Proof-of-Work (PoW) blockchains such as Bitcoin and the yet-unMerged Ethereum. The measure imposes a two-year moratorium on new PoW mining farm installations powered by carbon-based fuel. However, it leaves projects based on renewable energy sources or less energy-intensive Proof of Stake (PoS) mining operations ticking along unencumbered.

Following China's crackdown and an outright ban on cryptocurrency mining, many operators re-localized to Kazakhstan and the United States, sometimes placing undue strain on existing power infrastructures. Chief among the U.S. options for miners was the state of New York, due to its relatively cheap power sourced from hydroelectric facilities and a rising number of decommissioned or otherwise disabled carbon-based powerplants that cryptocurrency mining specialists could spin up with relative ease. 

It's estimated that renewable sources account for 50% of New York's energy production. Interestingly, a recent analysis led by Microstrategy places around 60% of Bitcoin's total power consumption as being derived from renewable sources.

The narrative surrounding cryptocurrencies' weight on the world's power grid and projected environmental impacts has led lawmakers to dial-in limitations on mining. Alongside the moratorium, the bill also enshrines a study on the environmental impact of mining facilities in New York, which aims to cut 85% of its greenhouse gas emissions by 2050.

The moratorium isn't currently being enforced, as it still needs to be approved (or vetoed) by Governor Kathy Hochul. Hochul last month received a $40,000 donation from "a chief executive of a company that runs a former aluminum plant turned cryptomining facility", according to The New York Times.

Lobbyists with The Bitcoin Association have spoken against the measure over fears of the "soft-ban" being eventually extended or turned into a full-fledged cryptocurrency mining ban in the state. It is threatening to leave and relocate to more mining-friendly states, such as Texas.

The possible end to cryptocurrency mining on the latest and greatest GPUs seems to be looming, as Ethereum's long-in-the-making move to Proof of Stake is poised to finally advance this Summer. Speaking at blockchain and Web3 event Permissionless, core Ethereum Developer Preston Van Loon said that code for The Merge is ready for deployment, with final testing currently underway for a tentative main release in August.

Originally slated to occur in 2019, the Ethereum network's Merge event marks the point at which the blockchain's security and consensus mechanism switches from the current Proof of Work (PoW) model, in which miners use their GPUs to number-crunch transactions in the network, to the less hardware and energy-demanding Proof of Stake (PoS) design. That transition will mark the end of GPU mining on the Ethereum network, whose token value (around $2,000 at time of writing) makes it one of the most profitable coins to mine (by far) without the need for specialized equipment such as Intel's Blockscale ASICs.

The Merge towards PoS should also allow Ethereum to claim higher energy efficiency compared to other PoW-based blockchains (such as Bitcoin) by reducing the overall energy requirements for system security and transaction processing by an estimated 99,95%.

The news comes at a time where the classic high-performance GPU players, AMD and Nvidia, are gearing up for their upcoming next-gen graphics cards (RX 7000 and RTX 40-series cards, respectively). With current expectations on actual hardware launch dates, The Merge occurring in August would hopefully prevent a repeat of escalating GPU prices which hit the best current-gen offerings from AMD and Nvidia, which have only recently achieved a semblance of normalcy.

Intel, the newest player in this discrete GPU field, is still in the process of launching its discrete Arc Alchemist GPUs, which the company already confirmed wouldn't carry a software limitation on cryptocurrency mining. Once again, The Merge happening as planned could impact mining-buoyed demand for these cards, depending on their workload performance.

Additionally, The Merge is expected to cut the issuance of new ETH tokens by about 90%, thus reducing the rate at which new Ethereum tokens enter circulation, introducing higher scarcity and - as market players hope - higher pricing.

All things considered, Ethereum's transition to Proof of Stake should significantly reduce the usage of GPUs in blockchain workloads, thus eliminating most of the additional, forked market demand for new GPUs. This means a possible end to cryptocurrency-specific GPU income for manufacturers AMD and Nvidia, and a potential overflow of second-hand, mining-used GPUs towards the secondary markets, further impacting GPU pricing and availability. There are many moving parts here; let's just hope The Merge stays on course for once.

Today, bitcoin holders are having a bad day as the iconic cryptocurrency slid nearly 5%. Bloomberg reports that the fall we have seen in the last 24 hours has brought Bitcoin (BTC) to its lowest level since July 2021. Furthermore, it reckons the downtrend will continue towards a crucial $30,000 make-or-break level, and cryptocurrency valuations generally show a "strong correlation with stocks."

Most would agree it is fair to characterize cryptocurrencies as volatile. Investing in these currency tokens secured by the blockchain has been a source of delight for those who got in early. However, the ups and downs in the last year or two have required a strong stomach.

As our headline says, the last time we saw BTC brushed with the $30,000 region was back in July 2021. However, it climbed to stratospheric highs in Nov 2021, cresting at nearly $69,000. If you look at today's valuation, which is oscillating around $33,000 at the time of writing, this represents a markdown of 30% on the best price in 2022 or a 50% reduction since the high of Nov 2021.

While Bloomberg compares the reduction in crypto valuations with the stock market, stocks have fared better in 2022, being just an average of 10% down. Meanwhile, gold, a popular commodity hold in times of turbulence, is up 2.5% this year.

In recent months there has been inflationary pressure seen in many parts of the world, primarily due to (but not limited to) energy prices and the Russian war in Ukraine. With worries about inflation and economic stagnation, some state banks have raised interest rates, encouraging people to save and prompting a global flight of capital from riskier investments. The greater risk or more speculative the investment, the harder it has been hit in recent weeks.

If you are interested in BTC as an investment, it is only natural to wonder about what will happen in the next few days and weeks. According to Bloomberg's chat with a crypto analyst, the current downtrend shows no sign of letting up. The $30,000 level was highlighted as a possible point of inflection. However, it would take a convincing bounce off that value to break out of the downtrend.

Where BTC leads, Ethereum (ETH) is sure to trend, and we note that this crypto with a special place in GPU-miners' hearts is also approx 5% down today at $2,385. Moreover, ETH's valuation is 34% down since the start of 2022 and 50% down from its all-time high in Nov 2021 ($4,865).

On the topic of speculative investments and blockchain technology, last week, we reported on the recent misfortunes experienced by NFT investors.

After months of spoon-feeding information on its curiously codenamed "Bonanza Mine" approach to blockchain technology, Intel has officially taken the first concrete, product-laden steps in the form of its Blockscale ASIC (Application-Specific Integrated Circuit). The announcement comes hot on the heels of several design wins, with cryptocurrency mining heavyweights Argo Blockchain, BLOCK (formerly known as Square), GRIID Infrastructure, and HIVE all inking multi-million-dollar deals for Intel's Blockscale solutions. The products are expected to see first deliveries by Q3 2022.

Helped by Intel's decades of expertise in semiconductor design and refinement, as well as cryptographic technologies, the Blockscale ASIC builds on the company's first-generation Bonanza Mine accelerator (BMZ1), which served as a proof of concept for the second Blockscale design. It aims to bring energy-efficient cryptocurrency mining to mining specialist companies focusing on PoW (Proof of Work) workloads, one of the strategies that help secure transactions in blockchain environments. To that end, Intel has created a specific division that handles strategy and product development in this space: the Custom Compute Group, nested within Intel's Accelerated Computing Systems and Graphics business unit.

“Intel is committed to advancing blockchain technology in a responsible way, and we’re proud to collaborate with and provide solutions to companies that are creating a more sustainable cryptocurrency ecosystem globally," said Jose Rios, general manager of Blockchain and Business Solutions in the Accelerated Computing Systems and Graphics Group at Intel. "The Intel Blockscale ASIC is going to play a major role in helping bitcoin mining companies achieve both sustainability and hash rate scaling objectives in the years ahead.”

This division isn't unlike AMD's semi-custom business, which takes the company's IP and adapts it to customers' needs from a workload, power, and performance perspective — and its shown record-shattering growth. AMD's approach has found the greatest success in gaming consoles, powering the latest and greatest from both Microsoft, Sony, and even Valve's Steam Deck, which can and do leverage the company's CPU and GPU expertise. Intel's new group, however, is especially geared toward blockchain and edge supercomputing designs. 

One Chip to Rule Them All

Intel's Blockscale is a relatively small, SHA-256 (Secure Hash Algorithm-256) hardware accelerator for blockchain proof-of-work consensus applications. Being an ASIC, the chips have been designed from the ground up with these workloads in mind, sacrificing the versatility of CPUs and GPUs in exchange for much higher throughput and power efficiency compared to other mining approaches.

Each first generation chip consumed a mere 14.2mm^2 in wafer area, meaning Intel could extract a theoretical maximum of around 4,000 chips from a single silicon wafer. Blockscale, however, occupies 52mm^2 per chip, while an AMD Zen 3 core (not including the cache and other CPU features) occupies a tiny 3.24mm^2. The increased chip size translates into higher performance, but it has the knock-on effect that Intel can now only theoretically extract around 1,250 chips from a single wafer.

While Intel hasn't confirmed who is manufacturing these chips, it's likely they aren't being produced in-house, but rather on TSMC's 5nm process, further condensing the design area, chip per wafer output, and power efficiency compared to Intel's current leading-edge manufacturing process, Intel 7.

Like mainstream computing solutions, Blockscale accelerators can be operated across a range of temperatures, frequencies and operating voltages, and are scalable at up to 256 ASICs per chain, delivering up to 580 GH/s (Gigahashes per second) per chip, down from BMZ1's 300 maximum chain size. A chain of 256 chips configured for maximum performance thus delivers a hypothetical 148 TH/s while consuming 5,811 W. Each ASIC can however be configured to consume between 4.8 to its maximum 22.7 watts of power, with an energy efficiency of up to 26 joules per terahash (J/TH). Higher TDP configurations would of course negatively affect power efficiency, so it's unlikely that most mining firms would configure their systems for maximum performance.

This provides Intel's clients with industry leading scaling opportunities, as they can find their own configuration sweet-spot according to limitations on floor space, power delivery, and cooling infrastructure available at time of deployment. And if any of those factors need adjustment over time, they can scale accordingly, in-line with whatever bottleneck they may be up against.

To further pressure the few competitors in the cryptocurrency mining ASIC space (namely Bitmain and MicroBT), Blockscale is supported by a reference hardware design and software stack to jump-start system development, which will likely become one of Intel's strongest business propositions. Whatever can be said about Intel's shortcomings and occasional missteps, it does provide excellent support and documentation via its Reference Design Materials.

One can only imagine the amount of funding Intel has poured into its new division, both in human resources and research and development. Judging by the huge contract wins that Intel has already secured even before its chips have left the actual silicon presses, the space is hungry for more capacity, with cryptocurrency mining companies — which actually should be thought-of as security and transaction enablers for blockchain ecosystems — facing extremely long lead-times in a specialized, somewhat monopolistic market.

Intel will undoubtedly secure profits directly derived from the sales of its Blockscale chips, but the company has pivoted its message around it to directly counter some of the most obvious backlash it could endure, which could itself result in lost profits. Intel knows its investment in the space threads a thin line in public perception, as most companies seem to when it comes to blockchain, the so-called Metaverse, and Web3. As such, Intel is keen to emphasize what could be defined as two of the most severe perception problems for blockchain technology: sustainability and the silicon shortage.

Threading the Sustainability Waters

Sustainability is one of the most common arguments levied against blockchain technology in its most visible implementation. This mainly happens due to the perception around blockchain utility and the tremendous energy consumption of PoW chains like Bitcoin, Ethereum (which will transition to a more energy-efficient Proof of Stake [PoS] algorithm in the near future, if things go according to plan), and a number of others.

Estimates aren't friendly: a single Bitcoin operation consumes around 2,248 KW/h - more than twenty times the amount of energy required by the VISA payments system to process 100,000 transactions. As a transaction system, the entirety of Bitcoin consumes as much power as Thailand, a country with 70 million citizens.

Global warming and sustainability are deservedly in the spotlight, especially with rising electricity costs, which also fluctuate according to supply and demand. Nefarious consequences have already arisen from over-extended energy grids that have provoked blackouts in several countries and U.S. states due to suddenly spiking demand from the installation or relocation of Bitcoin farms.

This is a relatively threatening climate for Intel to launch a product that accelerates these workloads. And thus, the company is doubling down on communication that focuses on energy efficiency and 'green mining,' promising "over 1000x better performance per watt than mainstream GPUs for SHA-256-based mining." Which is a bit of a crock, since these days all the big players are using ASICs for SHA-256 mining anyway.

Intel's Raja Koduri states: "We are mindful that some blockchains require an enormous amount of computing power, which unfortunately translates to an immense amount of energy. Our customers are asking for scalable and sustainable solutions, which is why we are focusing our efforts on realizing the full potential of blockchain by developing the most energy-efficient computing technologies at scale."

While this is all true, it's also interesting to consider the other side of the argument: Millions of people already extract some sort of utility from blockchain technologies. Companies have been built, powering not only experiences but also financial systems that enable seamless transactions to punch through even war-contested borders such as Ukraine. Bitcoin alone is held by around 106 million people throughout the world, with 53 million of those having traded in the cryptocurrency to some extent. In theory, users living in contested territories can use blockchain to invisibly carry their life's savings out of the country — something that could otherwise  be negated by the sheer volume of the equivalent in fiat or other valuable goods, such as gold.

User numbers are likely to only increase from here, as Bitcoin is already recognized and accepted as a means of payment by numerous businesses around the world. Large institutions and private companies have already started increasing their Bitcoin holdings and exploring blockchain technology for numerous pursuits, and it has even become legal tender in El Salvador, bringing undeniable utility to its roughly 6.5 million citizens.

It does seem like the only way for Bitcoin's energy consumption is up. Balaji Kanigicherla, Intel vice president and general manager of Custom Compute in the Accelerated Computing Systems and Graphics Group, said that "Momentum around blockchain continues to build. It is the enabler of decentralized and distributed computing, making way for innovative business models. To power this new era of computing, Intel is delivering solutions that can offer an optimal balance of hashing throughput and energy efficiency regardless of a customer’s operating environment. Intel’s decades of R&D in cryptography, hashing techniques and ultra-low voltage circuits make it possible for blockchain applications to scale their computing power without compromising on sustainability.”

The sustainability battle for Bitcoin and other cryptocurrencies likely stands closer to their chosen security method, i.e. via a change to a more energy-efficient consensus mechanism other than Proof of Work. But while that doesn't happen, Intel's expertise in designing energy-efficient circuits, and the increase in electrical efficiency for Bitcoin mining ASICS such as Blockscale, is certainly one of the ways of curtailing the exploding power consumption for the tech itself.

And while comparing Bitcoin's energy consumption with that of a country like Thailand is an eye-opening observation, the last available data puts the entire world's energy consumption at 160,000 TWh as of 2019.

Bitcoin's estimated energy consumption of 205 TWh in 2022 amounts to around 0.12% of the world's power consumption three years ago — and the world's power use has only increased. Bitcoin's slice of the world's power as of 2022 is thus even lower than 0.12%. Bitcoin mining today effectively consumes less energy per year than the world's billions of electrical appliances left on standby. Suddenly, Intel's investment in the blockchain space makes a lot more sense.

Mining in a Semiconductor Supply Gut

It's difficult to assess whether Intel's contract with TSMC for Blockscale will negatively impact the availability of other semiconductor products from the Taiwanese foundry. It's clear that there is an opportunity cost for every wafer that leaves TSMC's factories. Blockscale chips will be etched onto the same wafers that could've become the latest CPUs or GPUs for consumer or industrial applications. There is only so much capacity to go around, and planned multi-billion dollar capacity expansions from semiconductor manufacturers — including Intel's $80 billion Silicon Junction initiative in Europe — will take years to fully materialize.

Despite that, it seems unlikely that mining (whether via Intel's Blockscale chips or repurposed GPUs) will carry as much weight in the future as it has in the last two years. Ethereum mining stands as one of the highest impact pursuits for general consumer GPU availability, but that particular problem is potentially going the way of the proverbial dodo with that cryptocurrencies' impending move to PoS.

Intel, on one hand, says that its Blockscale chips were designed so as not to impact the supply of other electronics. The company now has fully embraced blockchain as a business vector, aiming to take advantage of its current (and future) value. The company has launched two products of its three-pronged attack on the space, following the release of blockchain-marketed Agilex-M series FPGAs and Blockscale. It remains to be seen if Intel's Arc Alchemist GPUs will surface in cryptocurrency mining rigs upon their release, although it seems that the worst of GPU-based mining is in its last throes.

It's a brave new world, and Intel has adapted its perspective to take advantage of a highly lucrative market. It remains to be seen how and if the company will also take a hand in shaping our possible blockchain futures, or if its Blockscale chip, and blockchain technology in general, will be a blip in humanity's radar. I'd bet three coffees on the former.

Note: This article was originally published on April 6, but our CMS accidentally ate it and apparently no one saw it. So we are republishing the content.

Ethereum's oft-delayed and long-in-development change in consensus mechanism, dubbed as "The Merge", has been once again delayed from its expected June deployment. Ethereum developer Tim Beiko confirmed via Twitter that the network's transition to Proof-of-Stake (PoS) is still in its finishing stages, and should be deployed a few months after the scheduled June date. The delay will keep Ethereum mining on GPUs profitable for a longer period of time, in turn opening up the doors for potentially slowing down, if not stalling the downward trend of graphics card pricing. But don't fret, as The Merge is still coming! Not that we haven't heard that before... like, for the past three years.

Originally slated to occur in 2019, the Ethereum network's Merge event marks the point at which the blockchain's security and consensus mechanism switches from the current  PoW (Proof of Work) model, in which miners use their GPUs to number-crunch transactions in the network, to the less hardware and energy-demanding Proof of Stake design. That transition will mark the end of GPU mining on the Ethereum network, whose token value (around $3,100 at time of writing) makes it one of the most profitable coins to mine (by far) absent of specialized equipment such as Intel's Blockscale ASICs.

The delayed transition means that GPU miners now have a few more extra months (perhaps even years) to eek out gains from their mining cards. Some miners may have already started offloading their mining equipment into secondary market platforms such as eBay in an attempt to pre-empt The Merge. For those who still haven't, they have now been given an extended grace period through which they can still take profits from their GPUs.

It also makes it highly likely that Intel's Arc family of discrete desktop GPUs will release before The Merge does. Depending on their street price and mining performance, which Intel said it wouldn't artificially limit, we could still see some of those cards making their way into mining rigs. We don't expect incredible mining performance from Arc, however, as even the top configurations use a 256-bit GDDR6 memory interface, akin to the RTX 3070/3060 Ti and the RX 6900 XT/6800 XT/6800. All of those not coincidentally land at around the 60–65 MH/s mark, half the speed of the RTX 3090/3090 Ti.

Miners will also have to take into account the falling prices of GPUs in the overall market, as supply has seemingly outstretched demand from both scalpers and miners alike. A few month's delay shouldn't spark another run on current-gen GPUs, as the average mining operation will require more than a year to recoup the investment on an RX 6800 as an example, at current Ethereum and graphics card prices. Still, this will likely delay the entry of used mining cards into the secondary market, potentially slowing price normalization for current-gen cards, which dropped around 15% in March alone.

This assumes that Ethereum's price doesn't positively evolve in the next few months as well. An exploding Ethereum price, with its strong correlation with GPU market prices, would bring profit ratios up. That in turn could potentially increasing miners' interest in scaling their operations, resulting in more demand for GPUs and bringing market prices back up.

Perhaps more crucial is that depending on how many months The Merge actually ends up being delayed — again, it was originally slated to happen in 2019 — there's the chance that it will now occur only after the launch of one or both of AMD and Nvidia's next-gen graphics cards designs. There are many moving pieces to this story, so let's hope reality doesn't conform to the more pessimistic outlook of the delay causing another long GPU winter.

Sky Mavis, the company behind the popular blockchain game Axie Infinity, announced it was the target of a $625 million hack. Taking advantage of vulnerabilities in the Ronin sidechain implementation, the hacker has shimmied away with around 173,600 ETH (valued at $594.6 million) and $25.5 million in U.S. dollars. Experts expect this to be one of the biggest hacks in the relatively short-lived history of cryptocurrency when all cards hit the proverbial table, but it's far from the first.

Axie Infinity is so popular that it's the number one marketplace for NFT collectibles. That puts it ahead of famous marketplaces such as OpenSea, which saw the introduction of the popular Bored Ape Yacht Club (BAYC) NFTs — of which the least expensive one currently goes for ~130 ETH ($356K).

Sidechains (also referred to as L2 chains) are solutions built alongside L1 chains such as Bitcoin, Ethereum and Algorand. These solutions help skirt blockchain congestion by offloading transactions that would occur on the L1 chain to the speedier, usually custom-built sidechains. Also known as Bridges or Wormholes, these allow users to bring their L1 chain funds (in this case, Ethereum) to other blockchain ecosystems. Crypto moved to these chains is locked as collateral, and an equivalent value is minted in whatever token the chain uses to operate. Being relatively stationary targets whose locked value tends to only increase over time, Bridges are particularly attractive targets for bad actors.

The exploit was carried out by first hitting the Ronin sidechain. The Ronin sidechain functions much like other cryptocurrencies, with trusted nodes validating transactions. However, they're still subject to 51% attacks: Should more than half the network be compromised, actors can then write whatever transactions they want to the chain, which will be confirmed by the majority of the (hacked) validators.

In this case, Ronin had only nine validator nodes, of which the attacker compromised five. This was more than enough to divert ungodly amounts of funds. It is a major reason why decentralization is such an essential factor for blockchain technology: The more nodes, and the more decentralized, the higher the difficulty of performing attacks such as these (at least theoretically).

Sky Mavis swiftly locked all network transactions and has increased the validation requirements from five nodes to eight nodes out of the full nine as a stopgap for any similarly exploitable vulnerabilities that still haven't been plugged. The Ronin Bridge remains inoperable, and other chains (such as Binance) have already disabled their own bridges to Ronin.

"We are in touch with security teams at major exchanges and will be reaching out to all in the coming days," the company said. "We are in the process of migrating our nodes, which is completely separated from our old infrastructure."

Sky Mavis also announced that it's working with Chainalysis to monitor the stolen funds, which currently appear to be sitting idly in the identified attacker's wallet. Unfortunately, that could be the case for a while. In all likelihood, and considering the apparent silence from the hackers, Sky Mavis won't have the same luck as L2 chain Polygon, which saw an equally impressive $611 million hack in August of 2021. Almost the entirety of the stolen funds was later returned, but not before the hacker compared himself to Batman.

A fully "certified and tested" $14,800 ASRock cryptomining server made in collaboration between ASRock and AMD has been spotted by Twitter's Komachi. Most interestingly, the system features twelve AMD BC-250 APUs that push it to a surprisingly powerful 610 MH/s. What are these APUs? The Twitter tipster thinks they might be PS5 "Oberon" processor cast-offs, and we, too, have heard the same story from a source familiar with the matter. This all means that AMD has apparently found yet another use for its defective PS5 silicon in addition to the AMD 4700S we reviewed.

ASRock is one of the most cryptomining-friendly PC and components makers, alongside Biostar. Perusing its site, you will find crypto-purposed motherboards as part of its BTC+ series and useful accessories and guides to getting started in cryptomining. However, it makes crypto mining servers too and sells barebones and fully populated servers to favored customers.

Komachi highlighted one of ASRock's mining rigs for sale in Slovenia. Described as an "ASRock Mining Rig Barebone 610 Mhs 12x AMD BC-250," the system is listed at €13,499, or approximately $14,800. The advert says that what is up for sale is a "quality computer for cryptocurrency mining operations with a guarantee made by a recognized manufacturer ASRock." It goes on to claim that the certified and tested system is the result of "cooperation between AMD and ASRock."

The ASRock mining rig listing shows the system from a number of angles. From the top-down view, you can see twelve PCI cards lined up with no obvious branding. The listing says these are "12 x AMD BC-250 mining APU passive design," meaning each board houses a PS5 APU. Elsewhere in the server is 16GB of GDDR6 RAM, five cooling fans, and a pair of 1200W power supplies.

You will note that there is no system CPU listed. However, one of the PS5 APUs may have working CPU cores used for general processing and housekeeping duties. This theory tallies with the 16GB of GDDR6 RAM, which is how the Sony PlayStation 5 is configured.

Some other details of this ready-to-roll cryptomining system are that it can hit approximately 610 MH/s when mining Ethereum (ETH). For reference, the Nvidia GeForce RTX 3090 can mine ETH at approx 120 MH/s while consuming 300W. (It's the only GPU from Nvidia that isn't locked via the LHR limiter these days, along with the newly launched GeForce RTX 3090 Ti.)

A quick check of US stores, and we see RTX 3090 cards available at $2,200. To match the performance of the ASRock server, you will need about five of these cards ($11,000) plus other components, like powerful GPUs that ensure 1500w for the GPUs alone.

The AMD BC-250 appears to be a known entity in the cryptomining world. For example, an ETH mining profitability calculator site in Norway lists a single BC-250 as being capable of just over 50 MH/s, which tallies with the ASRock server advert (12 x 50 MH/s = 600 MH/s). It adds that running one of these APUs in a mining capacity will make about $3 a day, depending on your electricity costs and the ever-changing value of ETH.

AMD 4700S and 4800S Desktop Kits Sidelined?

Rather than surplus PS5 APUs being used in cryptomining, some would prefer these APUs with active and working RDNA2 graphics cores were used in the AMD 4700S and A4800S Desktop Kits or similar.

Despite recent valuation gains, ETH mining is increasingly difficult, taking the edge off its attractiveness to GPU miners. Moreover, it is expected to transition to Proof of Stake in the coming months, making investments like $14,800 in the headlining ASRock cryptomining rig seem nonsensical.

Intel's bets on the blockchain space are attracting significant design wins, with the latest including one of the world's leading bitcoin mining companies. Blockchain company Hive has announced that it has agreed to purchase Intel's next-generation "BZM2" Bonanza Mine ASICs. Hive announced that the addition of Intel's upcoming chips would almost double its bitcoin mining power from 1.9 to 3.8 exahashes per second (Eh/s). The chips will be deployed in a new, 100 MW renewable-energy-focussed installation operated by Compute North LLC in Texas.

The deal establishes that the cryptocurrency mining devices will be delivered over one year starting in the second half of calendar 2022, lining up nicely with Intel's ASIC delivery for another of its Bonanza Mine clients, GRIID. Both companies expect the Intel-provided ASICs to offer increased performance and power efficiency compared to other available mining chip offerings. No information on the agreements' impact on the companies' bottom lines was revealed. Still, considering how we're looking at an almost doubling (95% increase) of HIVE's available hashpower on the shoulders of Intel's ASICs, this deal isn't a small one by any measure — and we have the doors open to some napkin math.

Intel's BZM2 pricing has already been non-officially disclosed as going for $5,625 per miner, with performance rated at 135 TH/s with an energy efficiency of 26 J/THs. HIVE's predicted hash power increase of 1.9 EH/s after the successful deployment of Intel's miners tells us that the company is installing ~14,000 thousand BZM2 devices.

In pure dollar terms, that means the Intel/HIVE deal could be worth around $79 million solely on hardware costs. However, despite the gargantuan cost, Intel has its competitors between a rock and a hard place: the company is extremely competitive in both efficiency and performance while undercutting its closest competitor, Bitmain's Antminer S19j XP, by almost 50% (Bitmain prices its S19j at around $10,455, with pricing being pegged to Bitcoin's value and updated daily).

Aydin Kilic, President & COO of HIVE, said that "Intel's energy-efficient and high performance blockchain accelerator is expected to reduce our power consumption over current ASIC miners on the market." He also expanded on the company's part in the product development and deployment, positioning HIVE more as a partner than a client: "HIVE will participate in the system development process from design verification, through to the prototype stages, and then factory & test engineering regimens to arrive at a production model; we are well-positioned and excited to undertake the process ahead."

Blockchain-related technologies and products are only expected to increase as time passes, and Intel seems to have pivoted its position to take advantage of the current and future market. While the last several years saw Intel mostly ignore the cryptocurrency space, the company now has three distinct product segments (and related business decisions) that are either directly or indirectly related to blockchain. In fact, Intel beat both AMD and Nvidia in its blockchain dive, at least when it comes to designing silicon that's especially geared towards blockchain workloads.

While Nvidia and AMD have been content in allowing their GPU solutions to be either freely used (AMD) or by adapting existing products towards cryptocurrency-mining-specific product lines (think Nvidia's Cryptocurrency Mining Processors [CMP]). Intel now stands as the first company of the three to fully design a mining-oriented product with its Bonanza Mine ASICs.

At the same time, Intel's latest FPGA solutions, in the form of the Agilex-M series, are now also being marketed for blockchain-related workloads, a first for the product segment. The third (current) angle of attack on the market isn't as direct as this one and doesn't carry a distinct marketing angle, but perhaps that's a wise decision on Intel's part: the company has confirmed that its upcoming ARC Alchemist graphics cards will perform at 100% of their capabilities when it comes to cryptocurrency mining workloads.

Intel announced its new Agilex M-Series of FPGA (Field-Programmable Gate Array) products, and at the same time gave some very interesting positioning toward cryptocurrency mining. Intel is claiming several "world-firsts" with the Agilex M-series, including usage of the Intel 7 (previously Intel 10 nm) manufacturing process, support for up to 32 GB HBM2e DRAM (via twin memory stacks), and a 60% performance increase compared to previous-generation Stratix FPGAs. No claims on cryptocurrency mining performance were made by Intel, however.

Designed by Intel's Programmable Solutions Group (PSG), which incorporated the talent and design IP from Intel's $16.7 billion Altera acquisition back in 2015, the new Agilex M-Series promise to offer the highest memory bandwidth in the industry. This is thanks to a pair of HBM2e stacks configurable up to 32 GB, which provide up to 820 GBps in memory bandwidth (410 GBps per stack). That could prove particularly useful for Dagger Hashimoto / Directed Acyclic Graph (DAG) workloads frequently associated with cryptocurrency mining, e.g. Ethereum.

Additionally, intel says its new Agilex M-Series are the first FPGAs supporting cache and memory coherency with Intel's Xeon CPUs via the Compute Express Link interconnect standard. Agilex-M FPGAs are also the world's only solutions capable of operating with three types of memory: HBM2e, DDR5, and Intel Optane — though to be fair, Intel has locked other vendors out of Optane implementations in the past.

The new Agilex M-Series FPGAs offer the industry's highest memory bandwidth for an FPGA, thanks to the inclusion of HBM2e memory and an external DDR5/LPDDR5 memory bank, all controlled via Agilex M's hardened memory controllers. Intel also claims the industry's highest Digital Signal Processing (DSP) compute capabilities in an HBM-enabled FPGA, though note that Intel doesn't claim the highest compute density in non-HBM-enabled FPGAs.

The same is true regarding Intel's efficiency claims. The company says its Agilex M products offer over twice the fabric performance per watt vs competitive 7nm FPGAs (read, Xilinx's Versal). The devil, as always, is in the details: Intel isn't claiming twice the performance per watt of its competitor's offerings, only fabric efficiency, likely boosted by the company's usage of its EMIB technology.

This is the first time an Intel FPGA product is being marketed toward cryptocurrency-related workloads, and it's the second Intel product in a single month looking to enter the blockchain space, after Intel's Bonanza Mine ASIC (Application-Specific Integrated Circuit) was made public. Intel seems to be adopting a broader strategy when it comes to blockchain workloads, and the company will be offering at least three distinct product segments that serve this space. While the Bonanza Mine ASIC and its subsequent iterations are a given, the new Agilex M-Series FPGAs are also joined by Intel's upcoming Arc Alchemist, which, as the company pointed out, will offer full performance in cryptocurrency mining workloads.

That Intel is marketing FPGAs for mining workloads doesn't detract from the more conventional use-cases for these chips, which include compute, cloud-to-edge infrastructure, pervasive connectivity, and AI. FPGAs are particularly desired due to their high flexibility, which allows for businesses to quickly iterate on semiconductor designs on the same piece of silicon, instead of spending the resources in multiple tape-outs of different approaches, solutions, and stages of a given chip's design.

It is interesting that Intel is broadening the appeal of its FGPAs toward markets they previously weren't in. This is happening against the backdrop of the apparently diminishing competitiveness of its Altera-based products compared to those made by Xilinx, which was recently acquired by AMD, turning it into a bigger company (by market capitalization) than even Intel.

By itself, Xilinx showcased an extremely impressive 2021, raking in $3.15 billion in revenue for a cool 20% increase YoY. Intel's PSG group, in contrast, brought in $1.9 billion in revenue, with only a 4% revenue increase YoY, signaling that the market found Xilinx's offerings to be preferable over Intel's solutions. However, Intel claimed that its PSG group could have brought in an additional $500 million in revenue were it not for the supply constraints felt throughout the semiconductor market at large — supply constraints that interestingly weren't mentioned in Xilinx's own earnings report.

It remains to be seen if Intel's "new" FPGA market, blockchain, will account for anything more than a product release marketing move, or if the company's solutions can indeed bring added value to a market dominated by ASICs.

China's Supreme Court hardened its stance on cryptocurrencies this Thursday after enshrining them into law under the list of illegal fundraising methods. The court's decision was already expected, following late 2021 declarations from the court, the People's Bank of China and other high-profile government institutions. Under the new interpretation, which goes into effect on March 1st, individuals illegally dabbling in cryptocurrencies could be levied with fines up to RMB 500,000 ($79,000) and face up to ten years in prison.

"This is the first Supreme Court legislative interpretation to officially have cryptocurrency transactions covered under the Criminal Law," said Winston Ma, adjunct professor of the law school at New York University. 

The new, legally-enshrined view on cryptocurrencies comes after many governmental decisions cracking down on the technology. A cryptocurrency mining ban was followed by a veritable hunt for illegal activities in the crypto space, prompting most of China's mining power to jump ship into less dangerous waters. Through the new legislation, suspects will be prosecuted under Article 176 of China's criminal law, which stipulates prison sentences between three to 10 years and fines between RMB 50,000 (US$7,900) and RMB 500,000 ($79,000) for crimes involving large sums of money. Less serious crimes will be prosecuted with under three years of prison and RMB 20,000 ($3,160) to RMB 200,000 ($31,600) in fines. 

Critically, the legislation refers to an extremely broad "cryptocurrency transactions" definition. This means virtually every movement associated with cryptocurrencies can fall under this umbrella term, as transactions are required in almost every cryptocurrency-related activity. The revised understanding of cryptocurrencies is aimed at "punishing illegal fundraising crimes in accordance with the law and maintaining national financial security and stability" and is being pursued as part of China's efforts to root out financial scams and money laundering. Of course, as we know, the crypto space isn't absent from these schemes.

China's decisions on cryptocurrency should not be mistaken as a sign that it is willing to abdicate the fundamental technological shift brought about by blockchain technology and tokenization. The country is in the advanced stages of its digital yuan experiments, which have already hit the ground running in several pilot programs across Chinese cities. A digital version of the country's national currency, the digital yuan, was used in more than $8 billion worth of transactions during the second half of 2021 alone. China's moves to regulate and constrain crypto usage on its soil likely come as a way to decrease the number of citizens and institutions conducting businesses in decentralized blockchains. This is the exact opposite of the digital yuan that is meant to be controlled in a centralized manner.

Interestingly, the overall cryptocurrency market seems to be mostly unaffected by the Russia-Ukraine war and the entrenchment of China's cryptocurrency policies. Market-maker Bitcoin, for instance, dropped 12% overnight from February 23rd to February 24th - the day both these events culminated in their respective stories. That has seemingly only been a blip on the cryptocurrency market's radar, however, as Bitcoin (and the market in general) has rebounded from those losses, currently trading at around 5% higher than before the dip.

At ISSCC 2022, Intel shared the deep-dive details of its new Bitcoin-mining Bonanza Mine ASICs and outlined how it melds 300 of these tiny power-efficient chips into a powerful 3,600W miner that delivers up to 40 THash/s of performance. [EDIT: We have since found the specifications and pricing for the newer model that is shipping to customers, which you can read about here.]

We first discovered Intel's Bonanza Mine ASICs in a listing for a presentation at the ISSCC 2022 conference, and the information below comes from the presentations at the event. This material covers the first generation of Intel's mining chips, known as BZM1, but the company has already moved on to its second-gen 'Bonanza Mine' ASIC, known as BZM2, that it is now making available to customers to challenge the likes of Bitmain and MicroBT.

After news of the company's efforts came to light, Intel finally officially acknowledged its blockchain/Bitcoin silicon program, divulging that it already has several large customers for the second-gen chips. That includes BLOCK (helmed by CEO Jack Dorsey of Twitter fame), Argo Blockchain, and GRIID Infrastructure.

Intel hasn't shared details of the second-gen chips and systems yet, but we do know they are derivatives of the BZM1 ASICs shown below. 

Here we can see the BZM1 chip in its rather small 7 x 7.5mm exposed-die FCLGA package (132 balls). As you'll see below, 300 of these chips power the system.

Each chip die measures 4.14 x 3.42mm, for a total of 14.16mm^2 of silicon, so these are comparatively small slivers of silicon. The smaller die size improves yield and maximizes wafer area usage (up to 4,000 die per wafer), thus helping maximize production capacity (though it does require more wafer dicing/packaging capacity). Intel says these are 7nm ASICs, but doesn't specify if that is its own 'Intel 7,' the original 7nm before it renamed the process node to 'Intel 4,' or TSMC's 7nm process.

Each Bonanza Mine ASIC has 258 mining engines, and each engine computes parallel SHA256 double hashes. These engines comprise 90% of the die area and operate at what Intel characterizes as an 'ultra-low' voltage of 355mV.

Each ASIC operates at 1.35 to 1.6 GHz at 75C, consuming an average of 7.5W apiece while hitting up to 137 Ghash/s. That works out to 55 J/THash/s at 355mV.

Zooming out to the 300 chips in the system, there's a total of 4,248mm^2 of silicon that delivers up to 40TH/s at 3600W of power consumption. It's clear that Intel will need to be far more competitive against Bitmain and MicroBT's existing miners. For instance, Bitmain's Antmienr S19j Pro 104T does 104 THash/s at 3,068W, while the newest model, the S19j XP, does 140 THash/s at 3010W. Again, these are Intel's first-gen Bonanza Mine chips, but its new contracts are for the second-gen 'BZM2' models that remain shrouded in mystery. 

Intel solders on 75 Bonanza Mine ASICs per hash board, arranged in 25-deep voltage stacks with ganged stack-voltages. The hash board also houses a microcontroller that manages power-on and thermal/stack-voltage monitoring. A 10MB/s UART serial link shuffles data between the chips and the control unit that sits atop the full system. 

Here we can see both the block diagram and images of the full system. Four hash boards are placed vertically into a single unit with four fans that keep the system cool.

The control unit sits atop the device, housing an Intel-FPGA-based system controller and an Arm Cortex core that runs the mining daemon and distributes the work among the 300 chips. The ARM core also adjusts the on-die PLLs to control chip frequencies and verify the ASICs' hash results. As you would expect, the unit also has an Ethernet connection to communicate with a larger mining pool. The system also has a programmable power supply. 

As shown above, the system can operate in different power/thermal profiles, like Power-Saving, Balanced, and High-Performance, to tailor the usage profile, thus yielding anywhere from 54 to 60 J/THash.

Intel built the system described above from the first-gen Bonanza Mine chips. However, Intel's second-gen chips can obviously be used in several configurations: GRIID's supply agreement with Intel has plenty of redactions to protect sensitive information, but it also heavily references Intel's Reference Design Materials. These are a series of documents that customers use as guidance when integrating the Bonanza Mine chips into their own custom systems.

This implies that Intel will supply the silicon to some of its customers, who will then create their own systems. This also meshes well with Jack Dorsey's plans for BLOCK, which he says will create a "bitcoin mining system based on custom silicon and open source for individuals and businesses worldwide." Of course, Intel could also manufacture complete mining systems and bring them to market through partners, but we'll have to wait to learn more about its go-to-market strategy.

Intel's first-gen Bonanza Mine chip sets a promising tone for its second-gen Bonanza Mine chips that are already working their way out to customers. However, there are still plenty of unknowns about the technical details of the second-gen chips, like performance, efficiency, pricing, power consumption, the process node, foundry used, and so on. We also don't know Intel's plans for its future roadmap.

Intel has a question and answer session scheduled at ISSCC for later in the week, and we'll follow up with more information after. 

Update 2/20/2020: Added details about Bitmain performance.

Her Majesty's Revenue and Customs (HMRC) with the UK has announced the country's first seizure of Non-Fungible Tokens (NFTs) as part of a broader fraud and tax evasion investigation. This is the first time NFTs have been seized as assets, which should serve as a way for the justice system to recoup administrative and investigation costs. The seized NFTs alone are worth an estimated $1.8 million.

Nick Sharp, HMRC's deputy director for economic crimes, said the NFT seizure is proof that HMRC is bound to "(...) constantly adapt to new technology to ensure we keep pace with how criminals and evaders look to conceal their assets," adding that this event "serves as a warning to anyone who thinks they can use crypto assets to hide money from HMRC." HMRC said it secured a court order authorizing the seizure of the three NFTs alongside around $6,765 worth of tokens for undisclosed cryptocurrencies.

Jake Moore, adviser at cybersecurity specialist ESET, said the event is proof that law enforcement is rapidly catching up with the new reality of blockchain-bound crimes. "A key element of cryptocurrencies' design is to keep them secure and protected against interception by anyone, whether that be a threat actor or law enforcement," Moore said. "But with a fast-moving digital world where mistakes can be made, police forces are beginning to buck the trend in how they investigate digital crime, locate evidence and finally seize digital assets."

The perpetrators took several steps to mask their activities from law enforcement, setting up an estimated 250 shell companies. They pretended to engage in legitimate business activities through the companies, but they merely served to divert transactions. Furthermore, the HMRC said the criminals employed other "sophisticated methods" to try to hide their identities, including the usage of false and stolen identities, false addresses, burner phones, Virtual Private Networks (VPNs), false invoices and pretending to engage in legitimate business activities. However, all of that obfuscation didn't fool authorities.

Considering the increasing relevance and monetary value locked into blockchain and NFTs in particular (and the rampant fraud, a daily occurrence in the sector), it's interesting to ponder how exactly these NFTs were seized. The report is understandably scarce regarding the blockchain these tokens were minted on, which could allow us to glean some details on the whole affair. The decentralized nature of blockchains is enough to give some hurdles to any cryptoasset seizures. This is further complicated by the capability for crypto users to place their wallets in cold storage. This signifies an area where the private keys that grant access to the wallet and its tokenized contents are stored in the real world, such as an encrypted hardware wallet or a piece of paper hidden amongst a book's pages.

Considering the (general) irreversibility of blockchains, it stands to reason that the only way for law enforcement to seize these NFTs would be to have gained access to the private keys, subsequently transferring the assets to a wallet under their control. The crypto community was quick to joke about how the seizure occurred and whether law enforcement limited themselves to right-clicking and saving the NFT images. 

Regardless of how the operation was carried out, the information made public by the HMRC is enough for us to at least glean the complexity of such investigations. Moreover, they will become more commonplace as blockchain and its tokenized elements become disseminated through wider swaths of the population.

Intel's Raja Koduri penned a blog post that officially announces the company's plans to enter the cryptomining/blockchain market with a roadmap of specialized energy-efficient accelerators. Intel will begin delivering the new chips, comprised of the Bonanza Mine ASICs that we recently unearthed, this year to several large customers as it enters the Bitcoin mining market that it expects to grow by $2.8 billion from 2021-2025. Intel's first customers include BLOCK (formerly known as Square and helmed by CEO Jack Dorsey of Twitter fame), Argo Blockchain, and GRIID Infrastructure. We'll provide a bit more detail on those relationships below.

Intel also announced that it had created a new Custom Compute Group, folded under Koduri's Accelerated Computing and Graphics (AXG) Business Unit, to design and build its blockchain hardware. The group will also build other unspecified custom accelerated supercomputing hardware based on Intel's existing IP blocks. It's unclear if those products could address other types of cryptocurrency mining, or if the unit will also serve as an adjunct to Intel Foundry Services (IFS). 

Intel shared an image of its new blockchain accelerator, but Koduri's missive is light on technical details. However, we already know quite a bit about the company's upcoming Bitcoin-mining hardware. We first discovered Intel's Bonanza Mine chips in a listing for a presentation at the upcoming ISSCC conference, but the company has already moved on to its second-gen 'Bonanza Mine' ASIC, known as BZM2. This chip has a specialized architecture designed specifically to accelerate SHA-256 (a cryptographic algorithm) processing for Bitcoin mining at ultra-low voltage. These energy-efficient chips produce what Intel characterizes as "over 1000x better performance per watt than mainstream GPUs for SHA-256-based mining."

However, GPUs aren't often used for SHA-256 / Bitcoin mining, so that isn't the best comparison. Instead, Bitcoin is typically mined on ASICs, which are specialized processors specifically designed to execute one type of workload. ASICs afford efficiency and performance advantages over more complex types of chips, like CPUs and GPUs, that can perform the same task.

Intel's Bonanza Mine will compete with other ASIC-based devices from companies like Bitmain (which has a quasi-monopoly on high-end miners) and MicroBT. These companies suffer from long lead times and charge prohibitively high pricing (often based on Bitcoin's valuation) for their chips. They also have to rely on third-party design houses and foundries for manufacturing. Foundries like TSMC don't tend to give these companies preferential status in their fabs due to the uncertainty of the demand and sporadic nature of cryptomining; instead, they prioritize longer-term steady business from bigger chip designers.

Intel has tremendous production capacity of its own, but it isn't clear if it will fab the BZM2 ASICs in its own internal fabs or outsource production to TSMC (BZM2 is rumored to use TSMC's 5nm). However, Intel has traditionally outsourced roughly 25% of its silicon production and will drastically increase that amount over the next few years as it moves its GPU and some CPU production to TSMC, meaning it has more purchasing power than competing mining hardware firms. Additionally, Intel has tight control over its supply chain and has its own production, including packaging and test (OSAT) capacity, a critical step in the manufacturing process that has proven to be one of the major contributors behind the ongoing semiconductor shortages.

Intel says that its mining hardware consists of tiny pieces of silicon (the first-gen BZM1 chip measures a mere 14.2mm^2), so this new foray shouldn't impact its supply of current products. However, much like you can see in the image of half of a Bitmain S19's hashboard above, mining ASICs are deployed en masse. We expect Intel's solution will have a similar arrangement, so it will consume a non-trivial amount of silicon in aggregate. However, the smaller die size boosts yield and maximizes wafer area usage (up to 4,000 die per wafer), thus helping maximize production capacity (though it does require more wafer dicing/packaging capacity). 

Intel's First Bitcoin Mining Customers

Intel has announced three of its first customers, BLOCK (formerly known as Square), Argo Blockchain, and GRIID Infrastructure, but it's possible that the company has other large customers that wish to remain unnamed. The Bitcoin mining industry has been plagued by hardware shortages and excessive pricing for the last few years. Considering that analysts predict 1.5 to 2 million Bitcoin miners will ship this year, that will likely continue. As such, Intel could prove to be a disruptive force in this market segment given its scale, more predictable pricing, and likely more predictable supply.

We can see some of those aspects come into play with Intel's deal with its first publicly known customer, GRIID computing, which will soon go public at an estimated $3.3 billion valuation. Intel has guaranteed GRIID that it will sell it a minimum of 25% of its overall mining ASIC supply through 2025 at fixed pricing (until 2023), which is far more desirable than the fluctuating pricing from competing firms like Bitmain that assign pricing based on Bitcoin valuation. GRIID considers Intel's pricing assurance to be a considerable competitive advantage over other mining firms, noting that hardware costs are the largest expenditure for any mining deployment.

GRIID's supply agreement with Intel has plenty of redactions to protect sensitive information, but it also heavily references Intel's Reference Design Materials, which are a series of documents that customers use as guidance when they integrate the Bonanza Mine chips into their own custom systems.

This implies that Intel will supply the silicon to some of its customers, who will then create their own systems. This also meshes well with Jack Dorsey's plans for BLOCK, which he says will create a “bitcoin mining system based on custom silicon and open source for individuals and businesses worldwide.” Intel could also manufacture complete mining systems and bring them to market through partners, but we'll have to wait to learn more details about its go-to-market strategy.

Intel's listing for the upcoming ISSCC conference notes that Bitcoin mining is currently estimated to consume 91TW-hour of power annually, which is greater than the country of Finland, but points out that customized accelerators can optimize energy efficiency. Koduri acknowledges that blockchains require tremendous amounts of energy, but says that Intel aims to provide scalable and energy-efficient solutions to "promote an open and secure blockchain ecosystem and advance this technology in a responsible and sustainable way."

Intel's publicly-acknowledged customers all say they focus on sustainable energy sources. Notably, GRIID claims that approximately 74% of its power consumption is carbon-free, with a goal of being 90% carbon-free by the end of 2023 — all without carbon offsets or credits. GRIID hasn't released firm projections of the number of machines it plans to deploy, but it intends to operate three industrial-scale facilities totaling 734 megawatts of power by 2023.

The publicly-traded Argo Blockchain, which recently purchased 20,000 Bitmain Antimer machines for its West Texas data center, says it is climate-positive and focuses on hydropower for most of its facilities, though it will use a combination of wind and solar for its Texas plants.

Finally, BLOCK (formerly known as Square), also has a heavy focus on renewable energy sources. The company recently partnered with Blockstream Mining to build an open-source solar-powered Bitcoin mining farm in the United States.

More To Come

Intel's Bonanza Mine chips could give it a solid beachhead in the lucrative Bitcoin mining market where its new competitors, like Bitmain and MicroBT, have long dominated. Intel will also not limit the mining performance of its standard Arc Alchemist GPUs that will come to market soon, allowing it to compete with its old rivals AMD and Nvidia in other types of cryptocurrency mining (like Ethereum).

This provides Intel with a dual-pronged strategy of ASICs and GPUs for the rapidly-growing blockchain/cryptomining market that it hasn't participated in before (at least not publicly). Plugging those products into Intel's global production and supply chains could help the company grow quickly and sidestep some of the production shortfalls we've seen with other mining hardware providers. 

Intel will present its first-gen Bonanza Mine chips at an industry event later this month, and its claimed 137 GH/s performance and 18.2 W/TH efficiency rivals the best mining ASICs on the market. That sets a promising tone for the company's second-gen Bonanza Mine chips. However, there are still plenty of unknowns about the technical details, like performance, efficiency, pricing, power consumption, the process node, foundry used, and so on. We also don't know the company's plans for its future roadmap.

One thing is clear, though: If Intel can deliver enough silicon with competitive efficiency, performance, and pricing, its entrance into the Bitcoin hardware market could disrupt the status quo and touch off a new performance/efficiency arms race. We're sure to learn more during the company's investor event next week and the ISCC presentation at the end of the month. Stay tuned. 

Microsoft has taken a bold step towards integrating blockchain and cryptocurrencies in its business structure. The company recently posted a new job opening for a "Director of Business Development - Cryptocurrencies" on its career website. It's just another confirmation that blockchain technology is here to stay.

The role is integrated into Microsoft's AI and Emerging Technologies business development team, which is the company's spearhead division for disruptive new technologies. The team essentially looks to emerging technologies, adapting them to existing Microsoft infrastructure (updating or building it from scratch as needed) and onboarding them as new revenue sources. 

"In this role, you will work closely with senior members of the Business Development organization to create data-driven strategies that will impact both short- and long-term engineering plans and product ideas to win in strategic markets. In addition, you will identify, assess, and structure complex partnerships and acquisitions."

Microsoft is looking for a Director with "an understanding of Web 3.0" and with "1+ years of experience in crypto, with working knowledge of tech and protocols surrounding DeFi, NFTs, DAOs, and Web 3.0." The company is keen on how impactful it expects the new iteration of the world wide web to be on its business model. 

The Windows developer is looking for someone who can "develop the vision, strategy, and roadmap for Microsoft's web 3.0 partnership model including infrastructure and APIs". As such, the new Director role must work across Microsoft's Product, Finance, Marketing, Legal and other divisions while advising on key technology and product roadmap development.

These aren't superfluous connections by any measure and go to show how Web 3.0 is going to be built into the backbone of tech companies going forward. Microsoft describing the role as having "potential for high impact and direct exec level visibility" only reinforces this idea. Web 3.0 and its associated technologies will be slowly built into existing corporations - perhaps slightly slower after Meta's recent 20% stock value crash. Microsoft, however, knows its future too lies in "The Metaverse" and in how that technology can be leveraged to bring people and communities closer together in more varied ways.

These days it seems like cryptocurrency is constantly in the news with some investors and miners taking home huge profits. If you’re not already involved, it may seem like getting into cryptocurrency mining — the process of minting a new coin by having your computer solve complex equations — could earn you some money. However, if you look carefully at the cost of building and maintaining your own mining rig, as we have below, you’ll find that it currently takes between 500 and 900 days just to break even. And that’s assuming your equipment doesn’t break and that current prices don’t sink much lower.

The latest downward trend in crypto prices, along with the uncertainty surrounding the key currencies, is bad news for new miners. However, given that miners have been snatching up GPUs and driving up GPU prices, it could be good news for gamers who want to buy the best graphics cards at anywhere close to MSRP.

One of the biggest factors in mining profitability is the amount of energy consumed. Looking just at Ethereum, since that's by far the largest cryptocurrency that's mined via GPUs, current estimates peg the Ethereum network's power use at 111 TWh per year and 261 kWh per transaction. That means if someone wants to buy lunch at a place that accepts Ethereum and sends $15, around the globe there will be about $26 worth of electricity (at a rate of $0.10 per kWh) burned up "securing the blockchain" for that (and other) transactions.

Ethereum 2.0 looks to address this major concern by switching to a proof of stake model, which would eliminate most of the power drain. That's slated to occur some time in the first half of 2022, though do note that it has already been pushed back two years and could end up being delayed once again. Now factor in the still-inflated GPU prices and you have a trifecta of great reasons to not think about starting mining or expanding an existing mining farm.

But let's say someone wants to throw caution to the wind. Just how bad an investment would it be to purchase PC hardware for cryptocurrency mining right now? Let's run some numbers, but start with a look at the current profitability of the last two generations of GPUs. We'll sort these according to the time required to break even, using current eBay GPU prices. We've factored in the cost of the rest of the PC as well as electricity costs, which gives the following:

One thing to note is that we're using LHR hash rates for the RTX 30-series GPUs, as Nvidia isn't allowing the production and sale of new non-LHR cards. Only the RTX 3090 remains fully unlocked for GPU mining. Also of note, more recent drivers and firmware seem to have rolled back some of the gains made by NBminer in overriding the LHR limiter, so that RTX 3080 Ti as an example only ends up running at 63 MH/s. We're giving miners the benefit of the doubt by not using the half-speed figures on the LHR cards, but Nvidia hasn't given up on limiting Ethereum mining performance. 

The best-case scenario for breaking even right now is around 520–550 days. That could be accomplished with the Radeon RX 5700 XT or 5700, Radeon RX 5600 XT, GeForce RTX 2060 Super, or the RTX 2070, using current prices. This of course assumes static profitability and the continued mining of Ethereum, neither of which are likely. For nearly all GPUs, Ethereum remains the most profitable option, with the next best choice typically averaging 33% less income. What that means is that in the coming months, if Ethereum goes through with the proof of stake change, miners could be looking at closer to 780–825 days just to break even, assuming all of the hardware remains fully functional.

That's at the "good" end of the spectrum as well. If you wanted to blow nearly 17 grand on an RTX 3090 setup, the current rate of around $4 per day per GPU means it would take 731 days to break even mining Ethereum. Without Ethereum, you're basically looking at three years of continuous mining to recover the cost of the hardware purchases.

And that's just for the cost of the mining rig, which of course doesn't exist in a vacuum. You also need space, infrastructure, internet, and cooling to keep everything running, especially in the warmer summer months. You also need someone to put everything together, maintain the hardware, and troubleshoot any problems. Those costs could easily double the expense, meaning double the amount of time to break even.

Just for clarity, here's the sample mining rig we're using for the above calculations, which uses six GPUs per PC. We have a motherboard that supports six PCIe slots (two x16 and four x1 slots), six riser cables, storage, memory, a modest CPU, and a good power supply. 

That's $758 as a baseline, not including the graphics cards and whatever extras might be needed to put it all together. Realistically, the cheapest approach is probably a bunch of zip ties to secure everything in place. We'll leave that as an exercise for the potential miner, because the whole point is that this really isn't going to be a great money making proposition.

With the above setup, after tuning for optimal efficiency, you could run six budget to mainstream GPUs (<150W power each), or if you want to chase higher hash rates, adding a second PSU would allow for up to six extreme GPUs like the RTX 3090 or RX 6900 XT and increase the cost by $220.

Mining on a Laptop?

As bad as that all sounds, there are even worse ways to try to mine cryptocurrencies. At the height of the crypto bubble last year, we reported on some places setting up mining farms using laptops. It was a stupid and short-sighted idea then, and it's an even worse idea now. The RTX 3080 mobile as an example is basically equivalent to a desktop RTX 3070, meaning best-case (i.e., without an LHR limiter) it could do perhaps 60 MH/s on Ethereum. With the limiter, it would be closer to 40 MH/s or less.

The problems with mining on a laptop are numerous. You have to pay for the entire system, and you only get a single GPU miner in the process. The cheapest RTX 3080 laptops typically cost more than $2,000 — twice as much as you'd pay for a similar performing desktop card. Even worse, cooling on a laptop most certainly isn't designed to run 24/7 at maxed-out loads. Even if we take the higher hash rate, you'd be looking at roughly 1,000 days to break even at current rates. Use the lower 40 MH/s value and that climbs to about 1,500 days. Then take away Ethereum mining and we'd be looking at perhaps 2,200 days to break even.

Raise your hand if you actually think a gaming laptop will run at 100% GPU load 24/7 for six years straight. Anyone with your hand up, I've got a sure-fire business proposition that will only require a modest investment…

Just Say No to Mining

The bottom line is that, as good as things might have looked in early 2021 for cryptocurrency mining, we knew it wouldn't last, and it didn't. There are of course pundits predicting the next big wave of cryptocurrency fever, and maybe they'll even be right. That's the problem with unregulated and pseudo-anonymous commodities like crypto coins. Maybe in a few years we'll see Bitcoin break $100,000 and Ethereum at $10,000 or more! Equally possible — more so in the minds of many people — is that this whole funny money scheme will prove unsustainable and many people will lose whatever savings they put into it.

Today, the Bitcoin network's security, using a cryptographic algorithm called SHA-256, would be insurmountable for a computer as we know it to crack. But quantum computing may change that within the next decade. Scientists at the University of Sussex now estimate that quantum computers are likely to become powerful enough to crack the security that protects Bitcoins sometime in the next decade. New Scientist first reported on the study.

Bitcoin is based on a blockchain, essentially a ledger of who owns what, protected by the SHA-256 algorithm. If you could crack the key revealed during Bitcoin transactions, you could change ownership of a Bitcoin. The Sussex scientists, led by Mark Webber, explain that every Bitcoin transaction is assigned a cryptographic key, which is vulnerable for a finite time, which might vary from 10 minutes to an hour, to a day.

The researchers estimate that a quantum computer with 1.9 billion qubits would be necessary to crack a Bitcoin's encryption within 10 minutes. To manage the feat within an hour, a machine with 317 million qubits would be required. However, if you had a full day to try and crack the security, a system packing just 13 million qubits would be capable of the task.

Right now, the most potent quantum computer, developed by IBM, boasts 127 qubits. We are obviously a long way from machines with 13 million qubits becoming available, and a 317 million+ qubit machine is a much better bet in practical cracking of Bitcoins, as things stand. The Sussex scientists reckon that with the pace of advances we see now, sufficiently powerful quantum computers will not be realized for "potentially over a decade," putting us firmly into the 2030s.

Any projected calamitous D-Day for Bitcoin is very much a moving target. The scientists note that the Bitcoin network "could nullify this threat by performing a soft fork onto an encryption method that is quantum secure, but there may be serious scaling concerns associated with the switch." On the other side of the tug-o-war, developments in quantum computing could easily accelerate progress towards being able to hack Bitcoin security. The researchers mention the potential of trapped ion-based quantum computers, for example.

Indirect Attacks Are Growing in Popularity

Absorbing the huge numbers discussed by the scientists, plus pondering over concepts of quantum supremacy and quantum advantage, it is easy to forget that the current tech news landscape is littered with news of various crypto currencies and exchanges being hacked, or investor or speculator funds being otherwise purloined. How is this happening with such strong encryption deployed?

Any secure system is only as secure as its weakest point, as were were reminded by the very recent Wormhole crypto hack. Earlier today we reported that Wormhole, one of the most popular bridges linking the Ethereum and Solana blockchains, leaked $320 million to hackers. Blockchain protocols like Wormhole are necessary to the system for cross currency transactions, and other purposes, but have become an increasingly popular target in recent months.

A decentralized finance (DeFi) platform called Wormhole said Wednesday that a hacker made off with approximately $322 million worth of cryptocurrency.

The heist was enabled by a flaw in Wormhole Portal, a "token bridge" that allows people to exchange one cryptocurrency for an equivalent amount of another. The service currently supports the Avalanche, Oasis, Binance Smart Chain, Ethereum, Polygon, Solana and Terra blockchains. (More details can be found in Portal's docs.)

Portal relies on smart contracts to function. According to The Record, someone exploited a flaw in these contracts to effectively "trick the Wormhole project into releasing Ether (ETH) and Solana (SOL) coins far beyond the input they initially provided," which is how they managed to steal $322 million worth of the tokens.

A more detailed technical breakdown was shared by Twitter user "@samczsun," who collaborated with "@gf_256" and "@ret2jazzy" to investigate the flaw in Portal:

"tl;dr - Wormhole didn't properly validate all input accounts," they explained in a follow-up tweet, "which allowed the attacker to spoof guardian signatures and mint 120,000 ETH on Solana, of which they bridged 93,750 back to Ethereum." 

Coinbase puts Ethereum at roughly $2,610 at the time of writing, so the haul is currently worth approximately $245 million. (This is part of the problem with stealing cryptocurrency—the market's volatility means $322 million worth of assets can fall to $245 million overnight. Not that anyone should feel bad for the hackers, of course.)

Wormhole then asked the hacker to return the assets. "We noticed you were able to exploit the Solana VAA verification and mint tokens," it said. "We d [sic] like to offer you a whitehat [sic] agreement, and present you a bug bounty of $10 million for exploit details, and returning the [wrapped Ethereum] you've [sic] minted."

These arrangements—wherein a hacker steals hundreds of millions of dollars worth of crypto and is offered a bounty for its return—are surprisingly common. For example, Poly Network employed the same tactic when $600 million was stolen from it last year, and earlier this week, Qubit Finance offered $2 million for the return of $80 million.

But, as The Record notes, these retroactive bug bounties aren't legal in all jurisdictions. They also incentivize hackers to exploit vulnerabilities in these DeFi projects. If they manage to steal a significant amount of cryptocurrency, they can decide if they want to keep their ill-gotten gains or settle for a smaller bounty.

Wormhole said this morning that it had restored the stolen funds:

The company hasn't said if the funds were restored because the hacker took the bounty, if it found another way to reclaim the funds, or if it's using its own assets to cover the loss. But it did say it's working on "a detailed incident report and will share it asap." One would hope that report would address the restoration of these funds.

The unofficial Minecraft-inspired NFT game "Blockverse" appears to have become one of the latest scams in the crypto world. At launch, and in a mere eight-hour period, Blockverse raised more than $1 Million from a community of users through the sale of 10,000 NFTs (Non-Fungible Tokens) priced at 0.05 ETH (~$127) each. Little did the users know that they'll lose their funds soon after in a rug pull - a sadly classic cryptoverse move.

Rug pulls (the term coined for when blockchain-based projects disappear with users' funds) are a constant of the daily blockchain life - in 2021, around 3,300 projects pulled rugs on their users, stealing approximately $7 billion worth of investor's money. Rug pulls work in much the same way that snake-oil sellers did back in the day: promising a product but not delivering it; cue the charlatan running away with his clichéd dollar-marked bag of money. Blockverse seemingly carried this out a mere two days later. The project deleted its digital footprint - website, Discord server, and game server all disappeared, and so did the only connection from users to their investment - their access-granting NFTs rendered worthless.

The possession of one of these 10,000 NFTs would give the limited player pool of users access to the game upon its launch. Being a digital token, these NFTs are also inherently tradeable, meaning that single accounts could hold more than one of these "access slips." Blockverse pulled off a significant pre-order event if it were a legitimate project, selling the equivalent of 10,000 licenses. Users paid $127 for a digital pre-order game. But a digital trail may have forced Blockverse to come back - partially.

The game's community members managed to track down a Coinbase address linked with the Blockverse founders. This address had funded most of the efforts with establishing the Blockverse; alongside it was a Cloudflare IP. So it would certainly be enough for law enforcement (or someone with less stellar intentions) to arrive at the founders' identities.

Three days after closing all of Blockverse's digital presence, and with the paper trail leads already disseminated through the community, its founders took to Twitter to explain the events from the following previous days. First, they claimed the project's legitimacy and explained that the reason for the flight was nothing more than an attempt at protecting their safety. But, according to them, several overwhelming and concerning complaints regarding some of the Blockverse's elements - gas fee prices for the NFT acquisition, lack of player capacity at 10,000 users, and lack of utility in the $DIAMOND tokens that only served as an access license.

"The FUD [fear, uncertainty, and doubt] quickly descended into harassment, threats, and doxxing," the creators wrote on Twitter. "The team noticed all this and panicked, deleting the discord server on impulse. Everything else was closed to prevent the continuation of harassment that had occurred so far. Even then, the plan was to reopen once everyone had time to calm down."

"There is absolutely no reason for us to leave permanently, as all the technical work and infrastructure for the project thus far has already been put in place. It was more work to take things down than to leave it up, but again, everything was done in the interest of protecting personal safety."

Despite this relative show of face (the project website is still down, for example), investors appear to be on the edge regarding the legitimacy and intentions of the project's founders. However, many have lost confidence in the project's founders. As a result, a group of community members is now negotiating that the original Blockverse developers cede control of the project. Interestingly, Blockverse's founders have sat at this bargaining table and agreed to hand over all relevant contracts and code while keeping the 500 ETH raised by the initial token sale - essentially paying themselves around $1 million for the initial development work. Blockverse has also apparently made a similar proposal to ArkDev, the founder of blockchain gaming platform NFT Worlds, although there's no public information of where that offer stands.

Even more surprisingly, the troubled project community members seem to be willing to cut their losses by settling with the founders. They're eager to let them keep 100 ETH (worth approximately $250,000 at current market prices) for the project's data while using the remaining funds to hire a development team. 

"What we really want are the assets and 200-400ETH to hire people to run the project," they said. "Most rug pulls recover little of anything, so the community is realistic in terms of a settlement. We are in agreement to letting them keep some. We just want enough to run the project."

Update: Intel's Bonanza Mine chip has now appeared in a contract with a mining startup, confirming that Intel is entering the cryptomining hardware business. 

Original Article:

It appears that Intel could enter the Bitcoin-mining hardware business, but not with its new upcoming GPUs. The ISSCC conference is a yearly gathering of the best and brightest minds in the chip industry. This year, Intel has a presentation scheduled in the 'Highlighted Chip Releases' category to outline a new "Bonanza Mine" processor, a chip described as an "ultra-low-voltage energy-efficient Bitcoin mining ASIC." That means Intel could soon compete with the likes of Bitmain in the market for specialized ASICs for Bitcoin mining. Intel also commented on the new chip to Tom's Hardware, saying "Intel has done design work around SHA 256 optimized ASICs for several years beginning with pathfinding work done in Intel Labs. We will share more details in the future."

The presentation comes on the heels of comments from Intel's GPU Chief Raja Koduri during a live stream last December, indicating that the company is working on specialized hardware for blockchain/cryptocurrency technologies. 

Bitcoin is typically mined on ASICs, which are specialized processors specifically designed to execute one type of workload. ASICs afford efficiency and performance advantages over more complex types of chips, like CPUs and GPUs, that can perform the same task. As a result, the overwhelming majority of Bitcoin mining occurs on ASICs, with companies like Bitmain providing the specialized silicon to miners at hefty premiums.

The first signs of Intel's interest in mining hardware surfaced in 2018 in the form of a patent for a specialized processing system that uses an optimized SHA-256 datapath (a cryptographic algorithm) for high-performance Bitcoin mining. As with all patents, the end product takes some time to come to market, but Intel has a wealth of experience in hardware-assisted SHA-256 algorithms due to the use of these instructions in its CPU products. Paired with its silicon production capabilities, Intel could be a particularly competitive entrant into the Bitcoin hardware market, especially given the focus on low-power, high-efficiency operation.  

Fast forward to December 29, 2021, and Intel's Systems and Graphics Architect, Senior Vice President and GM Raja Koduri appeared on popular streamer Dr. Lupo's show to promote the company's launch of its first gaming GPUs, the Arc Alchemist lineup that will launch this year.

Intel has signaled very clearly that it will not limit the mining performance of its upcoming discrete gaming GPUs, but the company still doesn't want its GPUs used for that purpose. Naturally, GPUs are used for Ethereum mining and other types of coins — not Bitcoin — but the topic led Koduri to make a few interesting statements about blockchain technology, which is the fundamental underlying tech behind crypto.

Koduri explained that Intel doesn't have an install base as a newcomer to the discrete gaming GPU market. As such, Intel would rather its GPUs be used by gamers than miners. However, Koduri's further comments are telling (28:20 in the above video):

"The other part of the answer is that we do think that this whole blockchain, as you call it, which coins are good  [...], I think blockchain is a transaction thing that is run much more efficiently than the burning of hardware cycles, is something that we are working on." Koduri said, "And that's not a GPU thing, so don't try to confuse that as a GPU thing. GPUs will do graphics, gaming, and all those wonderful things. But being able to do much more efficient blockchain validation at a much lower cost, much lower power, is a pretty solvable problem. And you know, we are working on that, and at some point in time, hopefully not too far into the future, we will kinda share some interesting hardware for that."

Given the timing of the ISSCC presentation, and the subject matter, it appears that Intel will share that information about the new hardware on Wednesday, February 23rd at 7 am PST. The 'DS1' moniker in the presentation listing denotes that Intel will have a video demo of the chip.

For now, it isn't clear if Intel will release the Bonanza Mine chip as a product for the public or if it remains confined to a research project. However, given that the chip is in the "Highlighted Chip Releases: Digital/ML" track and Koduri's comments, it's logical to expect that these chips, or some variant thereof, could be offered to customers in the future.

The primary bitcoin ASIC manufacturers, like Bitmain, suffer from long lead times and charge prohibitively high pricing for their chips, largely because they have to rely on third-party foundries to make the chips. Additionally, foundries like TSMC tend to not give these companies preferential status in their fabs due to the uncertainty of the demand and sporadic nature of cryptomining — instead, the fabs prioritize longer-term steady business from bigger chip designers. All of this is to say that Intel could make a meaningful and lucrative entry into this high-margin market backed by its incredible production capacity, giving it a leg up over competitors. Whether or not that will happen remains to be seen. 

We'll be there at ISSCC to learn more about the new chips. Stay tuned.  

Update 1/18/2022, 11am PT: Added Intel's statement to the article.  

Cryptocurrency mining can now be undertaken on a very wide range of devices, from the humble Raspberry Pi 4 to custom mining rigs. But rarely do we see a rig as retro as this. This antique powered mining laptop is provided by retro computing enthusiast Dmitrii Eliuseev, who recently published a blog post explaining how he was using an old Toshiba T3200SX Laptop with a 16MHz Intel 386SX processor (not even a DX!) to mine for Bitcoin. By Eliuseev's own calculations, it will take the Toshiba 584M years to earn $1 in Bitcoin.

Before setting out on his quest to mine Bitcoin on the Toshiba T3200SX, Eliuseev pondered over the wide range of computing devices that have been put to the same money-making purpose. At the top of the pile of Bitcoin mining machines there are specially created ASIC-powered Bitcoin farms, and it has been some time since personal computers and PC components, however powerful, have been of practical use for directly mining BTC. Nevertheless, people have set up Bitcoin mining operations on devices as low-powered as smartphones, or SBCs like the Raspberry Pi — just for fun.

The Toshiba T3200SX dates from 1989, and its launch price of $6,299 ($13,896 in today's money) put it out of reach of most people. It boasted a 16MHz Intel 80386SX CPU, which was cutting edge at the time, especially for a portable/luggable machine.

The lack of available mining software prompted Eliuseev to code his own Bitcoin mining tool based for the SHA256 algorithm. During this process, he kept bumping up against the limits of the 16-bit DOS platform, but with hard work and patience he managed to create his own code, available via GitHub. This code can be compiled on a contemporary Windows machine using the free Open Watcom compiler before being shovelled back onto an old DOS machine like the Toshiba 386SX. Alternatively, interested users can compile the code on a contemporary PC using an MS-DOS compiler like Borland C++, in the DOSBox emulator, before transferring it.

Impressive results, but not in a good way

So, now we arrive at the answer to the big question of how fast this ancient 32-year old 386-powered laptop can mine Bitcoin. The answer is impressive, in the expanse of time it would take to complete enough work to earn a solitary dollar. According to Eliuseev's calculations, it would take the Toshiba 584M years to earn $1 in Bitcoin. That's thanks to a blistering 15 H/s hash rate — yes, hashes per second.

Running the Bitcoin mining task on the old laptop doesn't use too much electricity, relatively. It sucked about 39W when busying itself with the cryptomining task. However, according to a mining profitability calculator we checked, users would be losing approx $3.37 per month running this process, so the prospect of $1 income in nearly 600M years of mining is even more risible.

To put the 386-powered laptop's 15 H/s into proper perspective, it compares favorably against the likes of a Toshiba T1100 Plus model with a 7.1MHz 8086 CPU and 3.6 hashes/s, noted Eliuseev. Looking at something more modern, the retro tinkerer reckons that the tiny Raspberry Pi 4 can achieve "about 200 KH/s" — note that we haven't been able to verify that Raspberry Pi Bitcoin mining performance figure. Back when CPU mining of BTC was all the rage (i.e. up until mid-2011), CPUs like the i7-990X were already over a million times faster than the 80386SX. Today, a top-tier modern ASIC miner like the Bitmain Antminer S19 Pro can achieve 110 TH/s, only about 7 trillion times faster than the old Toshiba laptop.

Further demonstrating the cryptomining on anything/everything trend, in recent days Tom's Hardware has reported on various cryptocurrencies being mined on Tesla Cars, or in background processes on your PC installed by AV software. Someone please figure out how to mine Bitcoin on an old HP calculator like the one I used in high school.

Bounty hunting in the blockchain arena seems to be pretty lucrative. Polygon Technology revealed Wednesday that a recent update to its mainnet was released to fix a bug that could have been exploited to steal over $24 billion worth of the MATIC token.

Polygon said the flaw was disclosed by "Leon Spacewalker" via the Immunefi bug bounty platform on December 3. The company prepared a patch to address the flaw later that day and released it to the Mumbai testnet on December 4. However, the bug was exploited later that day to steal $2 million worth of MATIC from the mainnet.

Another security researcher shared details about the vulnerability to Polygon a few hours after the MATIC was stolen. The company ended up paying both of the bounty hunters for their disclosure. Immunefi said that Spacewalker received $2.2 million in stablecoins; the second researcher earned $1.27 million worth of MATIC.

"This experience highlighted the importance of investing into an ecosystem of security expert partners," Polygon said. "We are very grateful to Immunefi for all their help. At the end of the day, this brought Polygon a step closer to becoming the most battle-tested scaling solution for Ethereum." Unfortunately, that is a dubious honor at best.

Polygon said it released the patch to address this flaw on December 5. However, it didn't offer additional information about the incident until December 29. Instead, it wanted to follow the "silent patches" policy used by the Geth team to minimize the potential impact of vulnerabilities that affect the Ethereum network.

The company said that it's also responding to the incident by:

• Updating our critical response processes;
• Consolidating partner contact info and communications channels;
• Identifying and formalizing backups for key internal resources to eliminate single points of failure during time sensitive situations

"In the grand scheme of things, and looking ahead at the future of DeFi, this won't be the last case where a severe vulnerability is found," Immunefi said. "As more funds pile into DeFi at record rates, more projects will also have critical exploits buried in their code. It is inevitable. The only difference is whether these future projects take comprehensive security measures and do everything they can to protect their code."

That might not be good news for these decentralized finance (DeFi) projects, but it seems bug bounty hunters can make decent not-quite-cash by looking for vulnerabilities. For example, Polygon theoretically caps its bug bounty program at $2 million, but in this case, it paid $3.46 million "in recognition of the severity of the vulnerability."

This also isn't the first time Polygon has pushed the limits of its bug bounty program. The company paid another security researcher, Gerhard Wagner, $2 million in October for a vulnerability that could have been exploited to steal $850 million worth of cryptocurrency. So far, it's paid out more than $5 million in the last two months.

The Merge, which will end Ethereum mining with GPUs, is taking important steps to becoming a reality with the formal opening of a new testnet designed to work out the kinks in the upcoming mining-less approach. That means gamers eventually won't have to compete with Ethereum miners for graphics cards. 

This news comes on the tail end of a pretty good year for Ethereum miners: Coinbase data shows the cryptocurrency's price rising from about $731 on January 1 to approximately $3,940 at the time of writing. In addition, the rise of non-fungible tokens (NFTs) pushed the Ethereum hashrate to record numbers. And the switch to a proof-of-stake model, which doesn't rely on miners to preserve the integrity of the blockchain, was delayed from the end of 2021 to some time in the first half of 2022.

But that switch—known most commonly as The Merge—is still coming. The Ethereum Foundation reminded miners of that inevitability Monday by introducing the Kintsugi testnet so developers could "familiarize themselves with Ethereum in a post-merge context." The opportunity for miners to maximize their profits ahead of The Merge or identify whichever cryptocurrency they're going to devote their compute power to afterward was left unsaid.

"The Kintsugi testnet provides the community an opportunity to experiment with post-merge Ethereum and begin to identify any issues," the foundation said in its announcement. "Once feedback has been incorporated into the client software [sic] and the specifications, a final series of testnets will be launched. In parallel, testing efforts will continue ramping up. After this, existing long-lived testnets will run through The Merge. Once these have upgraded and are stable, next up is Ethereum mainnet's transition to proof of stake 🎊." (Emoji theirs.)

Kintsugi has a dedicated landing page for testers; more information about using this public testnet can be found in the documentation. Ethereum developer Tim Beiko (who CoinDesk named one of the most influential people in crypto for 2021) offered a detailed breakdown of how Ethereum itself will operate after The Merge in an October blog post

"At a high-level, at The Merge, clients will switch from following PoW to following PoS to determine Ethereum's latest valid block," Beiko said. "Aside from that, most of the clients' functionality, and, more importantly, the EVM, its state, and how it executes transactions, will stay the same. [...] Post-merge, the current Eth1 and Eth2 clients respectively become the execution and consensus layers (or engines) of Ethereum. This means that node operators of either Eth1 or the Beacon Chain clients will need to run the 'other half' of the stack to have a fully validating node."

The rest of the blog post breaks down changes to Beacon Nodes, the Engine API, and the Execution Engine that will follow The Merge. (It's also punctuated with diagrams explaining the new architecture, but apparently they have been minted as NFTs, and we'd hate to suggest that NFT images can somehow be used by someone who doesn't own them.) Kintsugi is supposed to bring the Ethereum network one step closer to implementing this architecture.

The Ethereum Foundation has shared "various tasks to work through to make the Merge ready for Mainnet release" in "The Merge Mainnet Readiness Checklist" repository on GitHub. Of course, there's still plenty of work to do, so miners don't have to panic just yet. But it seems the day enthusiasts no longer have to compete with Ethereum miners for graphics cards is just a little closer.

RadioShack, which you might best remember for carrying all manner of trending electronics goods since its founding in 1921, is restructuring. The company has decided that its steps toward ecommerce weren't enough; it now wants to turn to blockchain technology. Specifically, it wants to become a Decentralized Finance (DeFi) provider. And it's positioning itself as the only entity that can "...be the bridge between the CEO's [sic] who control the world's corporations and the new world of cryptocurrencies." To help that ...interesting string of words move toward reality, the company plans to launch its own token: RADIO.

To be clear, the RadioShack of today isn't the one you remember from years past. It has transitioned from being a brick-and-mortar store toward ecommerce. And the transition was all but swift. RadioShack filed for Chapter Eleven bankruptcy in 2015 after 11 (yes, eleven) consecutive financial quarters in the red. Afterward, the brand was sold multiple times until it was finally acquired by holding company Retail Ecommerce Ventures (REV), owned by Tai Lopez and Alex Mehr (these names will be relevant in a bit). REV still holds the RadioShack brand - and they're betting on its mainstream recognition and storied past as a way to "bridge the gap and 'cross the chasm' of mainstream usage for Cryptocurrency."

The goal is to make RadioShack a leader among the companies riding the cryptocurrency market value from its current $3 trillion towards its estimated $250 trillion potential. RadioShack's executives plan on doing this by focusing "on the early majority. [RadioShack DeFi] will become the first to market with a 100 year old brand name that’s recognized in virtually all 190+ countries in the world." Because that's what cutting-edge currency tech is lacking: a brand name that peaked in the 1900s, and then collapsed.

RadioShack is building its DeFi ecosystem in partnership with Atlas USV (Universal Store of Value), a DeFi protocol that allows Decentralized Applications (dAPPS) to be built atop it. RadioShack then plans to launch a decentralized exchange (DEX) in the vein of Uniswap or Sushiswap. This "allows USV users to purchase third-party tokens in the open market and then transfer them to the Atlas USV treasury in return for discounted USV tokens."

Interestingly, Atlas USV is a small company (and a small protocol) in the crypto space. It still hasn't picked up by CoinGecko or CoinMarketCap, which track more than 10,000 different crypto assets in circulation around the globe. But its token, USV, can already be traded on DEXs. It's available on both the Ethereum and Solana chains, and each unit of USV is currently valued at an eyebrow-raising $948. If you're wondering who set up Atlas USV, this is where you should test your name recall capabilities: It's the brainchild of Tai Lopez and Alex Mehr.

Essentially, RadioShack is setting itself up to receive tokens that already have established market value. Options such as Bitcoin, Ethereum, Solana, and Atlas USV's own USV token could all then be staked, setting them up as liquidity pools. Users who stake these coins (meaning that they commit them to the liquidity pools and lock them in a smart contract that prevents them from being moved) will then receive RadioShack's own token, RADIO, in exchange. It's a tried and true way of launching a DEX, as Uniswap proved. Stakers become investors, and they immediately add to RadioShack's coffers by leaving their valuable crypto in their trust. It's also a tried and true strategy for rug-pulls, however, particularly in the DeFi space. This is the crypto space we're talking about, after all. The good coexists with the bad.

RadioShack is far from its peak number of retail locations. Before things crumbled, starting at around 2003, the company counted as many as 8,000 retail locations in the USA alone, and had a presence in South America and the Middle East. Its current 500 retail locations are an interesting element to the technology pivot; it makes sense that the company would make use of all that floor space to actually bring cryptocurrencies out of their abstract, digital presentation.

Considering the interest displayed by RadioShack in entering the blockchain space, it seems like a distinct possibility that the company might explore Non-Fungible Tokens (NFTs) next. Perhaps the retail locations could be useful here as well: RadioShack could envision running them as social spaces, for acquisition and trading of these NFTs. Perhaps RadioShack will even sell digital versions of its historic brick-and-mortar stores in a digital plot of land?

RadioShack would do well to thread lightly, though, irrespective of how deep a dive it takes onto cryptocurrencies. The crypto space is still fraught by high-profile thefts and scams (which snagged a collective $7.7 billion from their legit owners in 2020 already). Brands can die if they make the wrong bets, no matter how historically "tried and true" they feel to be. And while a brand like RadioShack certainly has more name recognition than most others in crypto world, it's still clearly on shaky ground and playing in a complicated, fast-moving space. 

Overclockers first explored liquid immersion cooling in the early 2000s, and select makers of servers adopted it for datacenters. Now, Bitcoin miners are turning to immersion cooling systems as they promise to eliminate overheating of cryptocurrency mining machines and maximize their earnings.

"The immersed equipment runs faster without overheating," said Nishant Sharma, founder of mining consultant BlocksBridge, in an interview with Bloomberg. "It looks like a fish tank with machines inside it. Sooner or later, all big miners will be doing large-scale immersion mining."

For example, Riot Blockchain, a Nasdaq-listed cryptocurrency miner from Texas, recently announced plans to develop the industry's first large-scale immersion-cooled Bitcoin mining facility with 46,000 mining machines. The facility will consume a whopping 20 MegaWatts of power. Meanwhile, some miners used liquid immersion cooling back in 2018.

Large Bitcoin mining farms resemble datacenters. Both use loads of expensive machines that crunch numbers 24/7 (only datacenters process useful data); both need to cool these machines down; both strive to maximize compute density; and both often have space constraints.

However, there are several significant differences. Datacenters are located in special facilities designed with air or liquid cooling in mind (two methods that require large cooling equipment). By contrast, mining farms are located in abandoned industrial facilities or warehouses. Operators of datacenters are concerned about things like total cost of ownership (TCO), so they tend to choose technologies that offer the right combination of features and qualities to keep their TCO in check. By contrast, since 80% of a miner's operating costs are electricity bills, cryptocurrency miners are concerned chiefly about performance and stable power supply rather than about TCO.

These days numerous cryptocurrency farms employ immersion cooling systems to lower temperatures of their mining machines, maximize their performance, and increase earnings per machine (which are quite expensive). Immersion cooling cools all components of a system and does not require large and complex equipment like industrial air conditioners or liquid cooling systems. However, this does not mean that immersion cooling is easy (or cheap) to deploy or service. Meanwhile, usage of immersion cooling allows the installation of additional mining machines into the same building to maximize their performance, two factors that offset all possible downsides of this method for cryptominers.

Immersion cooling has existed and evolved for years, so there are loads of equipment and non-conductive liquids to choose from, depending on whether one is dealing with a single-phase or dual-phase method of immersion cooling. Therefore, miners will not have technological problems deploying immersion cooling systems. What remains to be seen is how the volatility of cryptocurrencies affects cryptomining companies' willingness to enormous amounts of money into hardware while ignoring common practices set by traditional datacenters. 

A site called The NFT Bay has debuted to make "all the NFT's [sic] on the Ethereum & Solana blockchains" available to download via the visitor's torrent client of choice.

The idea behind non-fungible tokens (NFTs) is that someone can purchase a piece of digital art — which includes anything from a portrait to the World Wide Web's source code — using the same blockchain technology as cryptocurrency transactions. That way the artist can get paid for their work and the buyer has proof they own the NFT.

Here's the problem: The artwork associated with an NFT is just a file. There's nothing stopping anyone with a web browser from right-clicking on the NFT and downloading a copy of that art to their system. Now people won't even have to do the right-clicking themselves; all they have to do is torrent a bunch of art from The NFT Bay.

Buying an NFT is like purchasing bottled water even though a fountain offers the exact same water for free. The buyer is spending money they don't need to spend (and, because minting an NFT requires compute power, inflicting more damage on the environment) in exchange for nothing but theoretical ownership over that water.

Or as The NFT Bay creator Geoffrey Huntley explains in the site's description: "As web2.0 webhosts are known to go offline (404 errors) this handy torrent contains all of the NFT's [sic] so that future generations can study this generations [sic] tulip mania and collectively go... 'WTF? We destroyed our planet for THIS?!'"

The site otherwise appears to be a faithful, NFT-themed replica of The Pirate Bay, a website that we at Tom's Hardware have only glimpsed in screenshots. It purports to contain 14.9 TiB and 4.2 TiB of NFTs taken from the Ethereum and Solana blockchains, respectively, but we haven't verified the authenticity of the files.

The long-awaited Taproot upgrade to Bitcoin was finally activated on November 14, to make transactions more private and bring smart contracts to the blockchain.

Taproot was initially proposed in January 2018. It finally received approval from enough Bitcoin miners to enter the Speedy Trial phase—which gives developers five months to support the upgrade—on June 13. Now it's officially been activated. 

The biggest change arriving in Taproot is the switch from using the Elliptic Curve Digital Signature Algorithm (ECDSA), to relying on Schnorr signatures for transactions. This is supposed to offer a variety of benefits for people using the cryptocurrency.

CoinDesk reported that Schnorr signatures are "smaller and faster" than ECDSA signatures. This is supposed to make it easier to handle multi-signature transactions and make them harder to spot among simpler transactions on the blockchain.

But those slightly more private transactions won't be Taproot's primary selling point for many Bitcoin owners. The switch from ECDSA signatures to Schnorr signatures is also expected to make it easier than ever for Bitcoin to support smart contracts.

"The most important thing for Taproot is...smart contracts,” Marathon Digital Holdings CEO Fred Thiel told CNBC. "It’s already the primary driver of innovation on the ethereum network. Smart contracts essentially give you the opportunity to really build applications and businesses on the blockchain.”

These advancements could help Bitcoin continue to lead the crypto market. Not that it needed any—it's managed to set new price records despite losing China's mining operations and being subject to increasing criticism over its environmental impact.

Burger King today announced a partnership with investment platform Robinhood, marketed as "Burger King with a Side of Crypto". The campaign will see Burger King customers that subscribe to its Royal Perks premium service receive chances to win up to 1 unit of either Bitcoin ($61,848 at time of writing), Ethereum ($4,355) or Dogecoin ($0.2758). The deal will be available from today through November 21st - or while crypto supplies last.

Burger King has set aside 20 Bitcoins (~$1.2 million dollars), 200 Ethereum (~$870,000) and two million Dogecoin (~$551,000) for this promotional effort. The deal will enable members of its Royal Perks subscription to receive a single digital code to be distributed in purchases at or above a $5 minimum. Both physical venue and Burger King app purchases will grant eligibility for the digital code. Only one of these codes can be redeemed per day - but the ones that get randomly selected in the redeeming process will receive a full unit of either or the three cryptos.

Burger King understands the value of cryptocurrency as a hot commodity in societal conversation right now. Speaking to USA Today, vice president of the digital guest experience for Burger King North America Maria Posada described the partnership with Robinhood as a "natural fit", and motivated out of a desire to begin "offering crypto in a way that's accessible and digestible (literally and figuratively) – through our food."

Users will have to create an account with Robinhood, should they not have it already, which is where they'll redeem the Burger King code. Then, Robinhood will set them up with their own wallets, facilitating the process of actually "holding" one unit of cryptocurrency. This marketing campaign will be a wake-up call to some of its winners towards the power of blockchain and cryptocurrency, which should ultimately spread awareness for the technology.

ETH's price rose above $4,400 this morning as the Shiba Inu cryptocurrency, which is also based on the Ethereum blockchain, enjoyed a massive surge in popularity.

Coinbase puts the price of ETH at $4,429 at the time of writing. That's a month-over-month increase of approximately 58 percent, and according to CoinDesk, it's at least partly because Ethereum burned more tokens than it emitted in the last 24 hours.

Enter Shiba Inu. It's a memecoin that uses the same mascot as Dogecoin—which has also experienced a significant increase in price and popularity—and is based on Ethereum. Coinbase data currently puts Shiba Inu's price at $0.00007170.

Don't let the number of zeroes following that decimal point fool you: Shiba Inu is massive. Its price has risen by about 930 percent month-over-month (93,062,286.75 percent year-over-year) and it currently has a $39.9 billion market cap.

What does that have to do with the price of ETH? Well, CoinDesk cited Tokenview data showing that "Ethereum produced 15,109.34 ETH and burned 16,710.2 ETH in the past 24 hours," which means the net supply of ETH fell by about 1,600.

ETH's scarcity, Bitcoin's recent price increases, and an optimistic crypto market all pushed the price of ETH to a record high. Shiba Inu was the third-largest contributor to ETH's burn rate, CoinDesk said, so it can take some credit for this bump. Ruff.