ASIC stands for Application-Specific Integrated Circuit. It is a chip built to do exactly one job. In crypto, that job is almost always running SHA-256 as fast as the laws of physics allow, because SHA-256 is the hash function underneath Bitcoin’s proof-of-work.
Bitcoin was originally mined on laptops. Within a year people had moved to GPUs because graphics cards are much better at the kind of repetitive parallel math that hashing requires. By 2012 a few hobbyists were building FPGA mining rigs. By 2013 the first true ASICs shipped, and from that point on no general-purpose hardware has ever been profitable for Bitcoin mining again. The efficiency gap is something like a hundred to one.
A modern Bitcoin ASIC — a Bitmain Antminer S21, an MicroBT WhatsMiner M60, something from Canaan — draws about 3,500 watts and produces somewhere north of 200 trillion hashes per second. They cost a few thousand dollars each, run hot, and are deployed in industrial warehouses next to cheap power. Hydro in Washington state. Stranded gas in West Texas. Overflow capacity from Kazakhstani coal plants. The geography of Bitcoin mining is the geography of electricity that nobody else wants at the prices Bitcoin miners will pay.
Why Some Chains Fight ASICs
Once ASICs exist for your algorithm, mining concentrates into the hands of whoever can afford the hardware and the power. That is fine if you think (as Bitcoin does) that industrial-scale mining is a feature rather than a bug, because it gives miners huge sunk costs and makes them reliable long-term participants in the network. It is a problem if you think decentralised mining is part of the point.
Monero is the best-known example of an “ASIC-resistant” chain. Its algorithm, RandomX, is designed to depend on memory bandwidth and random instruction sequences in a way that makes it hard to accelerate with a dedicated chip. The result is that CPUs and GPUs stay roughly competitive with each other, and ordinary people can mine from their desktops. Ethereum was ASIC-resistant during its proof-of-work era using the Ethash algorithm, though it abandoned the whole question by switching to proof-of-stake in 2022.
The ASIC-resistance arms race is perpetual, because chip designers keep finding ways to build efficient hardware for algorithms that were supposed to be resistant. Every few years a coin declares itself ASIC-free and every few years the first ASIC ships for it.