Asic manufacturer Canaan receives investment and ventures into new business fields

The mining industry continues to develop. The Chinese manufacturer of Asic miners, Canaan, is actually famous for its Avalon series. However, after a massive investment in which the Chinese state was involved, Canaan is now expanding its business activities. It is possible that the generation of cryptocurrencies will become a by-product in the future.

The market for mining hardware has become a bit boring in recent years. This is why Trading Bitcoin Platforms 2021 is especially relevant. While at the beginning of the Asic wave, in the middle to the end of 2013, numerous producers were still competing for the miners, there is not so much choice today. Many manufacturers of the special chips, which can only mine Bitcoins, have gambled away the customers’ trust by having the devices delivered far too late.

Article continues below this advertisement

In 2014-2016 there was a kind Cleaning in the Asic sector. Numerous companies went bankrupt or sank into legal proceedings: CoinTerra, announced in mid-2013 with a large train station, never made it to market with its miners. Spoondolies and KnC have gone bankrupt, Butterfly Labs has been charged with fraud, has never produced competitive mining chips, and BitFury does not sell its miners publicly, it only rents them by shipload. Most of what remains are Bitmain’s AntMiners and Canaan’s Avalon miners.

Canaan has made some headlines in the past few weeks that are interesting enough to take a closer look at the company to look at.Canaan was founded in 2013 and, with its Avalon miners, earned a reputation as a pioneer in Asic manufacturing. After Asic inventor Yifu Guo left, Canaan Creative took over the company and continued the Avalon series, which has been continuously present over the past few years, but remained in the shadow of the more efficient Antminer from Bitmain.

{{{ 1}} In June 2016, Canaan was finally bought by LYT, a Chinese electronics company. According to Cryptocoinsnews, LYT paid more than 3 billion yen for Canaan, which at a good 460 million US dollars would be the largest acquisition in the Krypo industry to date. Exact details of what LYT intends to do with the Asic manufacturer were not known at the time.

It should now be clear that Canaan will continue to gain a foothold in the sale of Asic-Miner even after the takeover wants to expand its business model at the same time. BitFury could be a model here, the Georgian manufacturer of mining hardware, which mainly uses its chips for its own mining and uses its hash power to press information such as land registers into the blockchain for its customers, who mainly consist of western governments.

With the new business plan, Canaan and LYT succeeded in attracting new investors in any case. In a first round of investment, the company was able to collect 300 million yuan, or about 43 million US dollars, at the beginning of May this year. Investors include the fully Chinese state owned Jin Jian International Group, as well as Baopu Asset Management and Tunlan Investment.Little is known about the latter two investors.

Article continues below this advertisement

Already this investment is expressly against the background of expanding the business areas. Canaan CEO NG Zhang explains: “With the support of our investors, we are planning to let the blockchain grow and also to deliver the first KPU, Knowledge Processing Unit, a chip that specializes in AI (artificial intelligence).” To produce Asics that specialize in Artificial Intelligences. Whether this is even possible in view of Asics’ one-dimensionality is a question that I find difficult to answer. In any case, it demonstrates the importance that Bitcoin mining has on the general development of Asic technology.

In addition to the bold undertaking of bringing an AI to Asics, Canaan continues to focus on more classic business areas. On the one hand, this would be the sale of mining hardware. With the AvalonMiner 741, the company is bringing an Asic onto the market that, with 7.3 terahash and an energy consumption of 1150 watts, is somewhat less effective than Bitmain’s Antminer S9, which delivers 11.5-14 terahash with the same consumption. However, the $ 714 Avalon has a comparable purchase price per Terahash than the Antminer and scores with a lower initial investment threshold. Bitsonline tested the miner and was impressed.

Perhaps more interesting, however, could be Canaan’s move into another business area: Blockchain timestamps. Canaan recently acquired the Proof-of-Existence startup. Proof-of-Existence was founded in 2013 and has since immortalized the hash of thousands of documents as time stamps in the blockchain. This application seems to be the most relevant example of “blockchain technology” and is used, for example, when the Luxembourg Stock Exchange confirms documents relevant to regulation, when a plug-in for Office 10 stores proof of a document on the blockchain and for some other applications. {{ 1}}

Canaan co-founder Xiangfu Liu comments on the purchase of the startup: “The blockchain industry offers us opportunities in both hardware and service.We produce the hardware that secures the blockchain; and now, with the purchase of Proof-of-Existence, we will also provide services related to the protection against counterfeiting of the blockchain. ”

Article continues below this advertisement

With this expansion of services and the support of state investors, Canaan good chances of becoming a kind of Chinese copy of BitFury – and thus using the blockchain to perpetuate information on behalf of the state. If this trend continues, confirming transactions and creating new bitcoins could become the by-product of miners who become more or less archivists in the service of large corporations and governments.

Don’t miss another story! Get the Island’s latest news delivered straight to your inbox. Sign up to our daily newsletter here.

The views/opinions expressed in these comments are solely those of the author and do not represent those of Island Echo. House rules on commenting must be followed at all times.

Join our daily newsletter

News, Traffic & Travel Tweets