21 Inc. Finally Reveals Its Secretive Product: A Bitcoin Mining Chip

The cryptocurrency startup was able to secure upwards of $110 million in fundraising from a spate of big name investors like QUALCOMM, Inc. QCOM and PayPal co-founder Peter Thiel.

However, the company has been secretive about what it had been working on – until now.

A New Kind Of Chip

On Monday, the company revealed that it will roll out an embeddable chip that allows users to mine bitcoins from their wireless devices.

The chip is designed to verify transactions while running as a background process, thus providing the user with a "continuous stream of digital currency."

Related Link: Solving Bitcoins Scalability Problem

Integrating Bitcoin Into The IoT

21 Inc. says its chip wasn't designed as a way to make people rich, but instead the company says it's more focused on integrating the cryptocurrency into the Internet of Things (IoT) and creating a micropayment scheme.

Micropayment Device

The chip, called BitShare, can consolidate, what 21 Inc. expects to be, a large number of micropayments, as the Internet of Things gains traction. Instead of customers paying for each individual service, they can install a BitShare chip and pay for the fees associated with things like connected lightbulbs or automated fire alarms using their mined bitcoin.

The company says it eventually hopes to use the technology to make having a smartphone more attainable in developing countries by subsidizing some of the costs through bitcoin mining.

Related Link: Bitcoin: Making Progress In Europe

Is The Chip Worth It?

The chip marks a big development for the bitcoin community, but it isn't without criticism.

Many worry about the feasibility of such a product, as it is likely to use a great deal of data and could significantly reduce the battery life of a smartphone. Some say consumers will be unwilling to sacrifice those things for the comparatively small reward, which may be just a few cents worth of bitcoin.