Trezor, the original bitcoin hardware wallet company, has taken control of its silicon chip production by facilitating the manufacture of its own key component, the chip wrapper, in its flagship product, Trezor Model T.
The move dramatically optimises device production by eliminating the reliance on third parties in the highly complex chip manufacturing supply chain.
Prior to taking control of this process, the global chip shortage has meant that Trezor, like most electronic device manufacturers, has been exposed to fluctuations in component availability that in turn is sensitive to a variety of factors including geopolitical disruption, labour shortages due to Covid 19 and even droughts that limit the supply of the pure water required in the manufacturing process.
Demand planning is also highly complex. Spikes occur in response to bear-to-bull market fluctuations. They have also followed the consumer interest in cryptocurrency self custody, a demand that was sparked by the high profile implosion of centralised exchanges like Celsius, FTX and BlockFi in Q3 2022. During the same period Trezor saw a 300 per cent increase in sales of its hardware wallets for example.
Whilst the same level of security is achieved by Tezor taking control of the wrapping process, the company has reduced lead times in the supply cycle from two years to several months. This is turn eliminates delays in shipping finished products and protects the consumer from exposure to price fluctuations based on component supply and demand.
Štěpán Uherik, Chief Financial Officer at Trezor said: ”The twists and turns in demand for hardware wallets and the silicon supply chain disruption that we’ve seen over the past few years was a problem that we needed to solve.
“By unpacking the process, identifying areas where we could take control, and collaborating with our partner STMicroelectronics in new ways, we’ve managed to make the manufacturing as agile as it can be. This means we can respond quickly as the crypto currency market shows signs of recovery. It also adds more design freedom for future products, helping us to sustain our leadership in the increasingly competitive hardware wallet space.”
Last year, Tropic Square, a company also from the Satoshi Labs stable, launched TROPIC01, a secure open source chip that provides cryptographic key generation, encryption, signing, and authenticating users through digital identification methods.
“The chosen business model is very unique and can be applied in exceptional cases. Firstly, as a manufacturer, we require high minimum order quantities, and secondly, the customer must have specific know-how to encapsulate semiconductor components. We are very happy that there is a company like Trezor in the Czech Republic, with which we were able to successfully implement this project,” adds Tomáš Pokorný, Sales Manager at STMicroelectronics.
Trezor is the independent Czech company behind the world’s first Bitcoin hardware wallet, the Trezor One. Its flagship product, the Trezor Model T comes with a full-color touchscreen and many advanced features, and both wallets are enhanced by the free Trezor Suite app which increases privacy and makes crypto more intuitive.