The absence of supply chains is beginning to reveal numerous geopolitical dependencies on external actors for various resources and the general instability created for a given country when supply chains are in tension.
Changing just one small factor and the whole system will experience problems. Therefore, countries pay attention to this, and equate these problems with national security and react accordingly.
Solving The Problem Of Shortage Of Semiconductors
For example, the US Department of Commerce under the Biden administration is now actively engaged in solving supply chain problems, especially in the context of a shortage of semiconductors. Already in April and May of this year, he met with semiconductor companies that are links in the supply chain to better assess the current situation. After the last meetings in September, the Ministry of Commerce made requests to all suppliers to fully track each link and the complete supply chain as a whole.
He wants to know where companies fit into the supply chain, the size of their chip nodes in nanometers (nm), the type of chips or products they produce, estimated sales, inventories, and more. This is a very exhaustive query that essentially asks for everything you need to know about a company’s products, sales, inventory, and everything related to that company.
Its goal is to create a basis for a complete representation of the logistics flow of everything from production to packaging and delivery of products.
This request was met with a sharp reaction from both Taiwan and South Korea, emphasizing the huge geopolitical importance of chip manufacturing capacities in the global economy.
The Geopolitical Significance Of Chip Manufacturing
The Ministry of Trade, Industry and Energy of South Korea and the Ministry of Economy of Taiwan expressed concern about the number of requests for information. In particular, in Taiwan, where the largest manufacturer of TSMC chips is located, politicians even wondered whether fulfilling information requests could provide information that would ultimately jeopardize TSMC’s global dominance in the future.
Detailed information, such as the size of nanometers, the types of chips produced or their buyers, can in theory be used for infrastructure investments to push customers away from TSMC and successfully meet all their needs. For a country like Taiwan, the importance of the semiconductor industry is potentially a major deterrent to China’s attacks. The loss of this possession is perhaps much more important than just economic considerations.
While the U.S. Senate recently passed the U.S. Innovation and Competition Act, which will spend $52 billion to increase national semiconductor manufacturing capacity, and the Chips for America Act, which is being submitted to the Senate to create tax breaks for semiconductor companies, Taiwan fears may not be groundless.
The US has been busy reviving the domestic semiconductor industry since the Trump administration, and, ironically, the construction of the TSMC plant in Arizona, coordinated with Trump, only began this summer. Activity on this issue accelerated after supply bottlenecks caused by the blockage arose, since modern computer chips are needed for everything that could not be expected, for example, for kitchen appliances, cars and even light bulbs.
Bitcoin And Semiconductor Security
Semiconductors are very important now for digital technologies. Each country will need its own national security plan to ensure the security of semiconductor supplies, just as they have plans for energy security.
This all has to do with bitcoin in the sense that mining equipment requires electricity costs.
As for the production capacity of 7nm or less (advanced technology), the only games in town are Intel, Samsung and TSMC. This gives these companies a lot of political leverage that they can use to create advanced ASICs.
The dynamics of semiconductor production is already emerging in politics, as the world recognizes the importance of reducing dependence on foreign players to support this potential. How these problems are related to bitcoin mining will only be a matter of time.
Perhaps this is another accelerator for large countries to expand their domestic production capacities. Or countries with mining potential will block the export of miners to rival countries. Countries can spy to obtain intellectual property about advanced manufacturing technologies. The impact on mining will undoubtedly be exerted. Time will tell exactly which one.