It is claimed that the Russia-Ukraine conflict could hit Bitcoin mining. The crypto mining industry is facing a new crisis as the Russia-Ukraine conflict threatens to disrupt the supply of materials crucial to semiconductor manufacturing. The industry is still suffering from a severe chip shortage that has lasted for nearly two years, driving up the prices of graphics cards that are already crucial for the issuance of tokens. Details are on Kriptokoin.com.
Invasion of Ukraine and new risks for Bitcoin mining
Ukraine and Russia are the main suppliers of chip components. Consulting firm Techcet says in a report that Ukraine supplies about 90% of the neon of semiconductors, which is an integral part of lasers used in the US’s chipmaking process. Russia supplies 35% of the country’s supply of palladium, a rare metal used in the manufacture of some types of semiconductors. Any disruption is likely to have a broad impact on chip supply, which could cause processor prices to skyrocket once again. This, in turn, could curb potential expansion in the mining industry, which is heavily dependent on chip supply.
The White House warned chipmakers to diversify their supplies if Russia invaded Ukraine, Reuters reported earlier this month. With a full-blown conflict going on right now, supply disruptions are likely in the coming months. Dutch firm ASML recently said it is exploring alternatives to the current supply of neon. Other executives in the chipmaking industry also highlighted potential barriers to production if supply is disrupted.
Potential problems in chip manufacturing
Chip making giants Intel and Taiwan Semiconductor Manufacturing Co (TSMC) recently announced their plans to increase semiconductor production in response to increasing demand. TSMC, the world’s largest chip supplier, announced earlier this year that it has invested $44 billion to increase supply. With Bitcoin’s hash rate, i.e. the computational power required to issue new tokens, the mining industry, which has recently reached record highs, is expected to rely heavily on the stable chip supply. Is China-Taiwan tension another threat? The recent Ukrainian conflict has drawn comparisons with tensions between Taiwan and China. Any military attack by China is likely to shake up the global chip supply. Through TSMC, Taiwan is the world’s largest semiconductor exporter.
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