Toronto-based ePIC blockchain has wrapped up a $7.5 million series A funding round to bring ASIC manufacturing to North America.

“North America excels in a lot of chip technology, so there’s no reason that North America shouldn’t excel in Blockchain ASIC design and manufacturing,” ePIC CEO Henry Quan told CoinDesk. “There’s a lack of supply. New entrants can’t come in and get access to technology, so it’s kept a lot of players out.”

So-called application specific circuit (ASIC) miners are built specifically for mining cryptocurrencies, typically bitcoin, because they produce the hashes needed to mine blocks at a much more rapid rate than graphics cards or normal computer processors. ePIC currently builds ASICs for altcoins.

ASIC manufacturing is a sub-industry that, like crypto’s larger mining industry, is concentrated in China. As the only ASIC manufacturer in North America with a live product, ePIC’s expansion, (and any other’s that follow it) could relieve a supply-chain bottleneck that has plagued North American miners particularly during this bull market, causing a lack of access to mining machines.

“Having a North American ASIC manufacturer is critical for the long-term security of the Bitcoin network given supply chain constraints coming out of China and the need for more hashrate based in NA,” Ethan Vera, the CFO of North American mining pool and technology company Luxor, told CoinDesk.

“The growth of the Chinese mining ecosystem was a partial result of proximity to ASIC manufacturers. We can expect the same relationship to hold true with a North American ASIC manufacturer.”

The mining manufacturer’s customers include Argo, an American miner with a foothold in Texas, and CoreScientific, the largest mining datacenter provider in North America. ePIC will use the funding to produce its 3rd generation ASIC model which will be used to mine a “top 10 cryptocurrency,” according to Quan. The new rig is codenamed Amnesia and is forthcoming in Q4 of this year. 

ePIC currently produces ASICs to mine decentralized storage project Siacoin. With a team stacked with alumni from microchip manufacturer AMD, Quan told CoinDesk that developing Bitcoin ASICs is on the company’s roadmap. 

Bitcoin miners hungry for hashrate

Over the past year, miners have been in a mad dash for the metal, energy and warehouse necessary to expand their operations to cash in on the digital gold rush.

But the demand has meant that many miners, particularly those an ocean away from the foundries that source the machines they need, have to wait to access hardware. This has sent the price of old machines skyrocketing, as even machines as old as 2014 were in profit, leading into Bitcoin’s largest difficult adjustment this month.

Investment into North America’s mining sector has shown no signs of slowing, with some major players attempting to increase their hashrate as much as tenfold by the end of the year. 

Manufacturers like ePIC could correct the lopsided supply chain logistics these miners currently face.

“North America could be a mining powerhouse but three key pieces need to come together for that to happen. There’s a lot of cheap energy here, commercial miners and a favorable political climate, so that’s the first thing. Mining pools are another piece, which we have with Luxor and DCG. And now, we have the third piece with ePIC and ASIC manufacturing,” he said.

Quan would not specify when the company will begin producing ASICs for bitcoin mining. He commented that “bitcoin ASICs are the holy grail,” but to “compete in that market, one needs a lot of capital and access to leading edge foundry nodes such as 5 nanometer,” perhaps something for series B round, he intimated.

Luxor’s Vera commented that “starting with altcoin miners is an interesting way to approach creating a new bitcoin ASIC company as often it is less competitive and can be a good testing ground before entering the major leagues.”

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