A global chip shortage is affecting various sectors of industry from gaming to automotive and cryptocurrency mining.
Amid Bitcoin’s (BTC) ongoing bull run, the crypto mining industry became massively profitable. Many miners started aggressively stacking mining hardware —by sometimes unconventional methods— which led to shortages in other sectors.
The COVID-19 fueled surge in gaming consoles, computers and TVs has even had knock-on effects for car manufacturers, who are major consumers of silicon semiconductors. Chip shortages have even led General Motors to shut down three plants and slow production at others.
Amid this shortage, Chinese internet giant Baidu is reportedly raising money for a standalone artificial intelligence chip company.
According to a Feb. 10 report by CNBC, major venture capital firms like IDG Capital and Golden Gate Ventures, or GGV, are among potential investors in Baidu’s upcoming semiconductor firm. Both IDG and GGV are known for notable contributions to the blockchain industry, with IDG backing companies like KuCoin, and GGV supporting million dollar funds for crypto startups.
According to CNBC, the potential chip company would be a subsidiary with Baidu as the majority shareholder. The new semiconductor business would aim to sell chips to customers across several industries, including automakers.
Baidu is already running a proprietary chit unit, developing its Kunlun semiconductors. However, this unit is not enough to commercialize its technology, CNBC said, citing anonymous people familiar with the matter.
The latest news comes amid Baidu’s Nasdaq-traded shares hitting new all-time highs above $295 on Feb. 9. A number of global semiconductor companies like Nvidia have seen their stocks climb recently.