The “cold” against the water, Bitmain's AI path to self-help
After endless scenery, it also suddenly became sluggish. Now Bitmain has reached an important crossroads of transformation and self-help.
According to Twitter netizens, Bitmain lost 740 million US dollars in the third quarter. And if you add in the money invested in the hashrate war, this figure will only be higher.
Many people have probably forgotten. Just three months ago, Bitmain's prospectus also showed that its total profit for the first half of this year reached 743 million US dollars, an increase of nearly 8 times over the previous year. The contrast is astonishing.
Success is “mining”; defeat is also “mining”
I believe many people knew almost nothing about the company Bitmain in the second half of last year or even before this year. However, its 4 years of obscurity have a lot to do with the development of the blockchain industry. Or put it this way, Bitcoin contributed greatly to the reason why Bitmain was crowned with an aura; now it has fallen into the Altar of God, which is also related to Bitcoin.
The point in which Bitcoin appeared is critical. In 2008, the global financial crisis broke out, and its spread and impact are still being felt. At this time, Satoshi Nakamoto posted a Bitcoin white paper on a secret cryptography review group, detailing his ideas about virtual currency, which sparked quite a bit of water in a small area.
In 2009, Satoshi Nakamoto “mined” the first batch of 50 bitcoins. According to Bitcoin's POW mechanism, anyone can obtain bitcoins through a mining computer, but bitcoins are halved every four years, and the final circulation limit is 21 million. At this point, “mining” and “mining machines” only sprout. This year, Wu Jihan graduated from college and entered the investment industry.
Wu Jihan came into contact with Bitcoin in 2011. At the time, he had been in the investment industry for 4 years, and intuitively told him that Bitcoin was extremely valuable. At a time when the price of a single coin was $10, Wu Jihan entered the market with $100,000. The inflection point came in 2013.
This year, large amounts of capital poured into the Bitcoin market, causing the Bitcoin price to soar rapidly. In the last two months at the end of the year, the Bitcoin price quickly soared from around $200 to over $1,000, rising 5-6 times.
Meanwhile, in just 4 years, miners mined almost half of the total amount of bitcoins.
Things are scarce and expensive. The smaller the amount of bitcoins left, the higher the mining computing power requirements, and the “miners” feel more urgent. As a result, demand for ASIC mining machines with high computing power skyrocketed instantaneously.
Before the advent of ASIC miners, mining operations represented by the Bitcoin POW mechanism were all carried out based on CPU/GPUs. The advent of ASIC chips increased mining efficiency by 10,000 times.
It was under such circumstances that Wu Jihan quit his original investment banking job, founded Bitmain, and concentrated on “mining.”
With strong R&D capabilities and speed of iteration, the high-computing power ant miner developed by Bitmain quickly gained a foothold in the industry. The success of Antminers has made Bitmain's market influence and prospects more impressive. The production capacity of hundreds of thousands of mining rigs every year has made it beat other ASIC miners and monopolize 90% of the global Bitcoin mining machine market.
The time has come to 2017.
After a round of sharp rise, the price of Bitcoin also approached the 20,000 US dollar mark at the end of this year. Along with the rise in cryptocurrency prices, Ant Mining had a spectacular situation where it was difficult to find an aircraft for a while.
However, this rise only continued until the first half of this year. Beginning in the second half of the year, the development trend of the blockchain industry declined rapidly due to inconsistent technical standards and regulations, imperfect third-party evaluation mechanisms, difficult to break core technology bottlenecks, industry coin trading chaos, and related control policies.
Just take Bitcoin as an example. At the beginning of this year, the price of Bitcoin once reached a high of 15,000 US dollars. Up to now, Bitcoin has dropped to more than 3,000 US dollars, a drop of nearly 80%.
Bitcoin has plummeted and mining revenue has shrunk rapidly. Miner owners and miners bear the brunt. Reflected on Bitmain, this is a sharp drop in the price of Ant mining machines. Take the S9 mining rig as an example. It was first sold at around 20,000 yuan. At its peak in January this year, it was still hard to find a single machine that reached 35,000 yuan. However, the current retail price is only over 2,000 yuan.
In addition, Wu Jihan blatantly defaulted on the contract, triggering the continuous fermentation of negative news such as “public outrage.” Under the heavy attack, it only took 3 months for Bitmain to make a steady profit of 740 million US dollars in half a year to a total loss, and the original “intense” listing plan was suddenly put on hold.
Under the crisis, the transformation of Bitmain is already clear, which is to embrace AI chips.
Jenk Group's AI appeal
Bitmain has two CEOs. One is Wu Jihan; the other is Jenk Group, which has technical roots. Normally, there are two main reasons for the emergence of dual CEOs: corporate crises and internal differences. Bitmain seems to have taken over both.
There is no need to go into too much detail about the corporate crisis; internal differences seem to have been around for a long time.
If Wu Jihan's investment vision made Bitmain successful, then the Jenk Group brought Wu Jihan to the peak.
Judging from business data, the legal representative of Bitmain is not the “high-profile” Wu Jihan, but the Zhan Ke Group. He is the real boss of Bitmain. He actually accounts for 61% of the shares; Wu Jihan holds only 20% of the shares. However, this shareholding ratio stems from Wu Jihan's initial agreement with the Zhan Ke Group.
In 2013, Wu Jihan, a non-technical person, found the Jenk Group, promising that as long as the Jenk Group can successfully develop high-computing power mining machine chips, they can give their team shares, and that they can get shares every time they complete the manufacture and upgrade of the mining machine.
As it turns out, Wu Jihan has a very good eye.
From Tsinghua University to the Chinese Academy of Sciences, Zhan Ke Group has been working on IC design, and their strength is obvious to all. In just half a year, Jenk Group developed a 55nm Bitcoin mining chip, the BM1380, and the S1 generation Antminer based on the BM1380 chip. The computing power far surpassed that of its peers at the time. In addition to this, Jenk Group's own technology, which is dedicated only to research and development, has also grown very rapidly. As of today, the ant mining machine has been iterated to the 14th generation.
However, the “conflict” between Wu Jihan and the Zhan Ke team seems to have existed since the beginning.
As an investor, market judgment is Wu Jihan's foundation; as a technician, Zhan Ke Group can only excite him with advanced technology; mining machine chips are only one of them.
Some people say that because it is already at the forefront of the world in mining chip development, there is a lack of interest in the development of related products; others think that the reason Bitmain hasn't launched the latest mining chip in the past two years is because Jenk Group has successively suffered setbacks in this area and has plans to change the direction of research and development, while AI chip design is the main focus.
In fact, starting in 2016, the recruitment focus of the Bitmain technical team began to shift towards AI chip design talents. At the beginning of this year, Bitmain's product strategy director Tang Weiwei revealed that its AI chip team had exceeded 300 people. By September of this year, according to information in its prospectus, the number of AI chip designers alone had reached 298. At a time when the blockchain industry is collectively cooling down, this has clearly become Bitmain's best lifesaver.
Or as Wu Jihan once said, “Micree and I are on a complementary team. It's like a table tennis doubles game. When the ball hits, who decides who is in the best position to catch the ball.”
Now it's time for the Jenk team to pick up the ball.
From mining machine chips to AI chips, it's “going against the sky”
Compared to traditional chips, the advantages of AI chips need not be explained in too much detail. In addition to qualitative improvements in GPU/CPU processing speed, power consumption, and scalability, its performance improvements in dedicated use are even more outstanding. As a result, AI chips have become a must for many chip manufacturers.
According to the AI chip research report published by the US market research company ReportLinker, the global AI chip market will enter a stage of rapid development in the next 5 years. It is estimated that by 2023, the market size will reach 10.8 billion US dollars, with a compound annual growth rate of 53.6%. As can be seen, in addition to giant companies such as Intel, Nvidia, and Huawei entering the market one after another, startups such as Horizon and Cambrian are also making a big difference in the field of AI chips with their technical strength. Compared to Bitmain, it is clearly quite far behind in entering the market at this point. Fortunately, it is supported by mining chip development experience, and the development speed of AI chips is very fast. Leaving aside the aura brought by blockchain and digital currency, behind Bitmain's “mining machine sellers,” it can be called a high-performance computing chip research and development company.
“In the past few years, we have been making virtual currency computing chips. Now entering artificial intelligence is actually not the transformation described by the outside world; it is just finding a new field of application.” Regarding Bitmain's development of AI chip-related products, Jenk Group explained, “Traditional chips can no longer meet growing computing needs, and compared to FPGAs, special processors with ASIC architectures have a strong advantage in deep computing.”
In 2017, Jenk led a team to launch the first self-developed cloud data center AI chip “SOPHON (Arithmetic)” using the 28nm process, the deep learning acceleration card SC1 and SC1+, and the intelligent video analysis server SS1. It mainly focuses on the three fields of security, the Internet and big data, and officially entered the artificial intelligence industry.
In October of this year, Bitmain also released various products such as the BM1880, the deep learning and reasoning AI chip for the terminal, the BM1682 computerized smart server SA3, the embedded AI mini-machine SE3, the 3D face recognition smart terminal, and the BM1880-based development board, AI module, and computing power stick. Among them, the BM1880 was successfully streamed in July of this year.
It is easy to see that Bitmain is implementing a comprehensive AI chip layout from chips and hardware to computing platforms, from the cloud and edge side to terminals.
Actually, from entering the AI chip to being able to lay out the ecosystem, it only took less than 1 year for Bitmain. Of course, the situation is the inevitable reason, and strong R&D capabilities provide technical support for this.
In addition to the AI chips mentioned at length in Bitmain's prospectus, it also positions itself as “the second largest chip design company in China and the top ten in the world without a fab.”
Wu Jihan once said, “Humans are born to walk against the sky. We are as small as dust, yet we have to fight against the universe; we only have 70 years, yet we have to compete with creatures that are 14 billion years old.”
Source: MagiKe.com
