Electronics giant Samsung filed for a patent in May 2019 titled, “Programmable Blockchain Solid State Drive and Switch.” Even though few details are known about the newly designed system, a surge in patent applications filed by large corporations on blockchain is clearly visible.
Related: Bank of America’s Blockchain Foray: Patent Trolling or Hedging Risks?
Patent wars — i.e., battles between corporations or individuals to secure patents for litigation — are certainly not new. They have been widely practiced in the tech ecosystem since the times of Alexander Graham Bell at the turn of the 20th century, who was involved in over 600 lawsuits.
Any great invention from the past century has a history of some kind of patent war, but the digital age has accelerated this phenomenon. From the PC wars between Apple and Microsoft to the smartphone wars of the past decade, patents have been used for both offensive and defensive measures.
It has been clear since the beginning that blockchain would see an increasing interest from corporations, which would turn to securing their patents as soon as possible. In just over a year, IBM has tripled the number of blockchain patents secured in the United States to over 100, while Alibaba leads the way with over 260 patents related to blockchain.
The number of global blockchain patent filings now considerably outpaces the patent filings for other technologies. However, Samsung has stayed relatively restrained with blockchain. That is, until it registered for a programmable blockchain SSD.
Technical details about the Samsung patent
This programmable data storage device consists of a nonvolatile memory and a storage controller that is configured to control the system. It has a network interface and a field programmable gate array that is configured to implement a blockchain algorithm. While doing so, it stores at least a block of a blockchain corresponding to the blockchain algorithm in its nonvolatile memory through the storage controller.
Moreover, the gate array will be configured to a processor that has a memory with instructions stored. When executed, the processor sends and receives one or more blocks of the blockchain via the network interface. Additionally, the processor controls the programmable gate array to execute the blockchain algorithm on one or more blocks of the blockchain.
Advantages of the new patent
To understand the significance of this new patent, the drawbacks of general purpose computer devices and ASICs should first be examined.
General purpose computer devices (usually GPUs) must be combined with the right software, drivers and configurations to execute a moderately efficient mining algorithm. Even though one GPU can mine multiple coins through this technique, its efficiency is very low. What’s more, to change the coin being mined is a hassle and very few miners are able to do so, while the cost of GPUs can vary significantly, as their price is influenced by the gaming and virtual reality industries.
On the other hand, ASIC miners are professional mining equipment designed for computing a specific algorithm. This narrowed scope gives the hardware the ability to mine efficiently compared to general-purpose computing devices. However, the rigidity in mining algorithms makes the miner obsolete once a newer, more efficient device becomes available, and many coins are specifically designed to be incompatible with ASICs.
Sam Town, an independent crypto analyst told Cointelegraph that Samsung’s patent doesn’t necessarily mean that the company is going to develop the product:
“Patents are not necessarily a tool to just protect your idea. It can be a defensive weapon to stop other companies from making similar products. Moreover, it can be used to send a signal to the market about the company’s intentions. This is most likely the case with Samsung”
However, Nicolas Kokkalis, the head of technology at Pi, the first digital currency compatible with mobile mining, doesn’t agree with Town. Kokkalis stated:
“Flexibility comes at the cost of speed and power consumption. FPGAs can be re-programmed with software, but they are slower than ASICs and they consume more electrical power. So for consensus algorithms, like Bitcoin’s proof of work, where speed and power consumption is critical, ASICs will always be the choice of miners when possible. There are, however, attempts of consensus algorithms that aim to be ASIC-resistant, e.g., by producing memory-limited algorithms, GPU-hungry functions or by periodically changing the algorithm leaving no-time for ASIC designers to create ASICs in time before the next algorithm rotation.”
Cointelegraph reached out to the inventors of the patent — Rajinikanth Pandurangan and Vijay Balakrishnan — for their comment on the matter, as well as Samsung, but each refrained from commenting on the matter.
Crypto mining and Samsung
The aforementioned patent is not the first time Samsung has tried to disrupt the crypto mining space. The company has been designing and manufacturing three nanometer and five nanometer chips for Bitcoin mining since the first quarter of 2018.
The manufacturing process is based on extreme ultraviolet lithography technology, which makes the new 7LPP chips more dense and energy efficient. Samsung states that 7LPP will enable the development of other emerging technologies, such as artificial intelligence, the Internet of Things, networking, 5G, automotive as well as technology for enterprise and hyperscale data centers.
Samsung has also entered into a strategic partnership with MicroBT — the third-largest designer of Bitcoin ASICs. MicroBT’s latest device, the M20S WhatsMiner, has 68 terahashes per second (Th/s) and a power efficiency of 48 watts per terahash. To compare this with industry standards, Bitmain Antminer S9 achieves 13.5 Th/s with a power efficiency of 98 watts per terahash — making Samsung’s chips allegedly five times more powerful than those used by Bitmain.
Samsung’s potential pivot toward crypto mining should not come as a surprise, as it is the world’s second-largest producer of semiconductor, just behind Intel, which has actually been making its own mining chips.
In November 2018, Intel filed a patent for “energy-efficient high-performance Bitcoin mining.” The patent for a system-on-a-chip includes hardware that accelerates Bitcoin mining, reduces power consumption and is optimized to reduce the space and energy utilized during the mining process.
What is the impact of big players entering the market?
The sheer size of Samsung’s semiconductor plant could give the firm an automatic advantage, and the same goes for Intel — and this is only taking its existing infrastructure into account. Samsung is one of the biggest spenders on R&D, spending over $8 billion during the first half of this year alone. With the ever-changing mining algorithms and the need to be continually efficient, new tech from these giants could easily supersede existing hardware.
Town believes there is no way around this problem. In his opinion, unregulated capitalism is bound to create monopolies:
“It is the very nature of competition. There will be a winner (or a few) and most will either be acquired or they will die out. The idea that companies will compete in perpetuity and benefit consumers as a result is flawed. The advantages that Samsung has over miners like Bitmain and Canaan can never be overcome.”
However, Samsung’s foray into mining could also have positive impacts on the ecosystem. Being one of the largest companies in the world, the tech giant can make an impression on regulations worldwide. Theoretically, Samsung possesses the influence and resources to lobby governments and even change the public perception around crypto.
Samsung hopping on the crypto bandwagon
Hardware manufacturing is not the only front in which Samsung has shown interest in blockchain technology. In 2019, Samsung invested around $8.1 million in the blockchain-based company Blocco and $4 million in KZen Networks. The tech company even confirmed that it is in the process of developing its own blockchain mainnet based on the Ethereum platform. Moreover, the company announced it was working on its own crypto token: the Samsung Coin.
President and CEO of Samsung SDS Hong Yuan Zhen disclosed in May 2019 that blockchain can improve productivity in the manufacturing industry. He even praised the productivity gains that real-time data analysis and predictions could bring in conjunction with blockchain technology.
In July 2019, the company announced that Samsung Galaxy S10 users could add the Pundi XWallet app to their Samsung Blockchain Wallet. Customers can move cryptos in the Samsung Blockchain Wallet into the XWallet. XWAllet now supports 33 different cryptocurrencies and has seen integration of decentralized applications (DApps). Over 10 DApps are already on the wallet.