An application specific integrated circuit (ASIC) is an integrated circuit that is used to perform a specific operation or to calculate a specific function or set of functions and is designed for that purpose. Since ASICs are designed to perform a specific function, they can only be used by the person or company that designed them. The fact that ASICs are custom-made makes them considered proprietary technology.
Computerized devices that use ASICs for mining purposes only are called ASIC miners. An ASIC miner is created to mine a unit of digital assets. For example, an Ethereum ASIC miner can only mine ETH.
What Is ASIC Miner?
ASIC miners are specialized computer hardware designed specifically for mining a particular cryptocurrency. These devices stand out for their high performance and energy efficiency thanks to ASIC chips.
Since ASICs are designed specifically for cryptocurrency mining, they are hardware that can work faster than other computers. However, developing and producing ASICs is quite expensive and complex. ASIC mining hardware performs cryptocurrency mining operations faster and more efficiently due to their high performance and energy efficiency.
Cryptocurrency mining has become a low-profit activity lately, but many people still show interest in this area. Mining activity is considered a risky investment because of its uncertain return.
Cryptocurrency miners are willing to spend significant amounts of money on expensive ASIC devices and ongoing electricity costs. In exchange for these costs, miners are hoping to earn cryptocurrency.
What Are the Types of ASIC?
ASICs can be categorized into three different types: Full Custom ASICs, Semi-Custom ASICs and Platform ASICs.
Full Custom ASICs
It is defined as circuits that are made from scratch for a specific application and whose original purpose is decided by the designer. Certain layers of these circuits are designed precisely in such a way that no modifications are possible.
Semi-Custom ASICs
They are defined as semi-customized circuits to perform different functions within their application area. The layers of these circuits are designed to allow for some modifications during their production.
Platform ASICs
These circuits consist of slices of a pre-designed and manufactured platform. Having a pre-designed platform slice reduces the cost of developing the circuit.
What Do ASIC Devices Do?
ASIC devices are useful for providing the hashing power needed for cryptocurrency mining. Since the devices need to be refurbished every year, there are a limited number of companies that can refurbish and buy these ASICs. This results in limited centralization of cryptocurrency mining.
Mining is the process of generating hash output, which is used to move on to the next block of transactions when the transaction potential is exhausted. The miner who completes this process is entitled to the block reward. Since ASICs are devices that are limited to a specific transaction, they cannot be used in any other transaction. For this reason, ASICs become obsolete quickly.
