How Much Is Cryptocurrency Mining Influencing Chip Demand
The popularity of mining Bitcoin and other cryptocurrencies has increased attention on the shortage of semiconductors, which are used in the computers that mine cryptocurrency. While chip stocks have surged higher as prices have risen for this critical tech component, cryptocurrency mining may not hold as much influence over the chip sector as many people might assume.
There are several factors that have led to the current chip shortage. For instance, demand surged as more office workers switched to remote work in 2020 due to COVID-19, and snowstorms in Texas and fires in Japan and Taiwan shuttered production at many fabrication facilities earlier this year.
When it comes to the impact of cryptocurrency miners on demand, the evidence is not so dramatic. For instance, Taiwan Semiconductor (TSMC), which makes the chips designed by AMD and NVIDIA that often go into mining systems, is looking at cryptocurrency accounting for only about 1% of revenue this year, according to an estimate from Bernstein as reported by The Wall Street Journal. This compares to approximately 10% of its revenue in 2018.
Source Fool.com
