Jack Dorsey’s Block Is Building a Bitcoin Mining System

Jack Dorsey’s payments company, Block, is developing its own bitcoin mining setup to strengthen its position in the complex and competitive crypto mining industry, according to a statement released on Tuesday.

In a recent blog update, the company, previously named Square, announced that they have successfully developed their three-nanometer mining chip in secret since April 2023. The intricate design of this chip is currently undergoing production at a leading international semiconductor foundry as per the post’s details.

Besides this, Block announced that they held discussions with local community members regarding the challenges within the bitcoin mining sector. In response, they intend to create a comprehensive bitcoin mining setup, encompassing system design as part of their plans.

In the post, it was mentioned that they had engaged in extensive conversations with numerous Bitcoin miners to understand their difficulties. Based on these learnings and our commitment to promoting mining decentralization, we intend to introduce both an individual mining chip and a comprehensive mining system, which will be designed by us.

Approximately 60% of the bitcoin mining market is controlled by a small number of companies, with Bitmain based in Beijing being the leading player, based on CoinShares’ calculations.

“James Butterfill, head of research at CoinShares, commented that with fewer major rivals, there’s a large opportunity for innovation and upheaval.”

In May 2023, Block unveiled a prototype of a 5-nanometer Bitcoin mining chip, similar to the technology used in Bitmain’s S21 mining machine. According to Block, this development suggests that future 3-nanometer chips could potentially deliver even better energy efficiency.

In recent years, the demand for bitcoin has led to significant advances in chip efficiency. However, the most recent halving on April 20, which reduced the creation of new bitcoins by half, increases the significance of faster mining speeds, lower costs, and greater reliability according to Butterfill.