Ever since Bitcoin exploded in popularity, the crypto industry has continued to grow by leaps and bounds. But all of that growth came at a price — a massive spike in electricity usage and a terrible impact on the environment.
The reason for that is the fact that the blockchain — which is the technology that underpins cryptocurrencies — requires a massive amount of computing power to operate. And what’s worse, it appears that every time crypto prices rise, the amount of energy their blockchain systems consume rises along with them.
But now, global processor powerhouse Intel has announced plans to invest in the development of crypto-optimized processors to help solve the industry’s power problems. Here’s a look at what they have planned and how it might impact the crypto industry going forward.
A New Blockchain Accelerator
At their core, blockchain systems are encrypted digital ledgers. But they rely on large networks of computers, which perform massively complex mathematical equations to validate the data as it’s added to the ledger. It’s not the kind of work that general-purpose computer processors excel at.
But it is the kind of work that graphics processors handle with relative ease. The trouble is — graphics processors weren’t developed with energy efficiency in mind. To solve the problem, Intel has announced that it’s readying a new type of processor that it calls a “blockchain accelerator”. And according to Intel’s representatives, it should deliver roughly 1000x the performance per watt compared to the graphics processors now used to power the major blockchains.
Key Early Adopters
The prospect of a vastly more efficient processor aimed at the crypto market is a major development for the industry. And it appears that Intel has already lined up its first major customers for its new processor line. Already, the Jack Dorsey-led Block and major crypto mining operator GRIID have placed substantial pre-orders for the new chip.
The announcement by Block is significant because it represents a major vote of confidence from a well-established company. The firm — formerly known as Square — has a massive financial services portfolio that generated an estimated $9.4 billion in 2020. And that it’s moving forward with its crypto expansion plans using Intel’s processor says a lot about expectations for the chip.
And GRIID, for its part, is one of the largest crypto mining operators in the US. At the time of this writing, it already operates three major mining facilities and has plans to expand to a total of 734 megawatts of capacity by 2023. Their decision to shift toward the new Intel processor means they could maximize the impact of that expansion and end up supercharging their computing capacity in the process.
The Takeaway
It’s important to recognize that Intel’s entry into the crypto-processor market isn’t just significant because it represents a chance at solving one of blockchain’s biggest problems. It’s also important because it marks the entry of one of the world’s biggest processor manufacturers into an industry that could use some competition.
And if the price of operating a blockchain system comes down substantially as a result — It could trigger a new wave of crypto development and help the industry as it continues to mature. And that could be quite lucrative for everyone involved.
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