The U.S. has placed Sophgo Technologies, an AI chip company founded by Bitmain co-founder Zhan Ketuan, on its blacklist due to concerns that its chips may be used in Huawei products to circumvent sanctions.
A Financial Times report reveals that U.S. officials accuse Sophgo of “acting at the behest of Beijing” to strengthen China’s chipmaking industry. The report also highlights a challenging period for Bitmain when Zhan shifted its focus to AI chips, leading to internal conflicts within the company. According to the report, the issues began when Zhan redirected resources towards AI chip development, with his shift beyond crypto hardware sparking internal conflict.
“We are a company focused on high-performance processors. We started with cryptocurrency processors, and now we’re entering artificial intelligence; it’s a new area of application but not a complete pivot, ”
Zhan told a gathering in Beijing in 2017.
The blacklist puts Sophgo in a difficult position by severing its ties with Taiwan Semiconductor Manufacturing Company (TSMC), the world’s top chipmaker, raising concerns that Bitmain could also be affected. However, according to the report, TSMC fully complies with global regulations.
Notably, Zhan co-founded Bitmain with Wu Jihan in 2013, which became a leading company in Bitcoin mining hardware, generating $2.5 billion in revenue by 2017. Bitmain also owns BTC.com and Antpool, two major Bitcoin mining pools.
Meanwhile, Miami-based Hut 8 is expanding its partnership with Bitmain to launch the U3S21EXPH ASIC mining machine, which will be deployed in Q2 2025. This machine can achieve speeds of up to 860 TH/s and will be the first mass-produced ASIC with direct liquid-to-chip cooling in a U-shaped design. Asher Genoot from Hut 8 emphasized its cost-efficiency and potential for AI infrastructure growth. The agreement allows for the phased acquisition of hosted miners, which could increase Hut 8’s self-mining hashrate from 5.6 EH/s to 20.6 EH/s.
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