There are plenty of ways to play the cryptocurrency mining wave, but there's one chip stock that might be getting overlooked in the gold rush. 

Taiwan Semiconductor Manufacturing Co. (TSM)  got a surprising boost from the cryptocurrency boom in its latest quarterly earnings report, showing that Nvidia Corp. (NVDA) and Advanced Micro Devices Inc. (AMD) aren't the only chipmakers benefiting from the surge in mining for bitcoin, ethereum and other cryptocurrencies. 

Roughly $350 million to $400 million of Taiwan Semi's revenue in the third quarter (reported Oct. 19) came from cryptocurrency mining, said Taiwan Semi co-CEO Mark Liu on the company's earnings call with investors. That's a relatively small proportion of Taiwan Semi's total revenue of $8.32 billion for the quarter, but Liu said he expects said he expects a similar amount of revenue from cryptocurrency-related revenues in the fourth quarter. 

Taiwan Semi is the world's largest semiconductor foundry, meaning it makes chips for semiconductor designers that don't have their own "fabs," or factories. The company manufactures chips used in Apple Inc.'s (AAPL) iPads and iPhones, as well as various internet of things devices. It also works with automotive vendors that increasingly require high-level chips to power self-driving vehicles. 

Taiwan Semi has had an impressive run this year, alongside a broader rally in semiconductor stocks. The stock has climbed 48% year to date vs. the PHLX Semiconductor Index's gain of 42% over the same time frame. 

Cryptocurrency mining belongs to a category known as high-performance computing -- data-intensive tasks that require sophisticated processors. The category is currently a small portion of Taiwan Semi's overall business, but the company expects market demand for it to surge in the coming years. Taiwan Semi not only works with companies building their own mining-oriented chips, but also with firms such as Bitmain, one of the world's largest makers of crypto-mining rigs that's based in China.

Liu estimated on the Oct. earnings call that the total addressable market for high-performance computing wafers is currently about $11.5 billion. He added that that computing market could double in the next five years, eventually becoming Taiwan Semi's "major growth engine" starting in 2020. 

If Taiwan Semi continues to generate roughly $400 million in quarterly sales from cryptocurrency mining, that would amount to $1.6 billion in revenue over the next year, or at least 5% of TSCMI's total sales, said Frank Curzio, CEO of investment research firm Curzio Research.  

"Based on this number, TSM has more exposure to cryptocurrency (based on sales) than any publicly traded company I found," Curzio said. 

Taiwan Semi can also serve as a leading indicator for where the cryptocurrency market is headed next, based on its sales, Curzio noted. If the company sees an increase in cryptocurrency-related revenue in the coming quarters, it shows that more firms are building cryptocurrency-oriented chips. If not, then the cryptocurrency market could be on the decline. 

Co-CEO Liu said his company remains cautious about the sustainability of the revenue boost from cryptocurrency mining. 

"As you know, the cryptocurrency price is very volatile," Liu said to analysts on the company's earnings call. "We look at cryptocurrency as an initial application for [blockchain.] So it's the technology that's very interesting and it will transform many of the contracts or payment technology today." 

"Of course our customer is very bullish on demand for next year, but we count it cautiously," Liu said. 

In the cryptocurrency arena, Taiwan Semi is primarily seeing strong demand for ASICs (application-specific integrated circuit) chips that are custom designed to handle powerful mining programs. For now, though, ASICs chips sales aren't significant enough to be broken out separately, Liu said. 

RBC Capital Markets analyst Mitch Steves also noted that Taiwan Semi's overall exposure to cryptocurrency mining is "pretty minimal," because of how broad its business is. 

"As an example, that would be like investing in Apple specifically for headphone sales exposure," he added.

For now, it appears that Taiwan Semi's high-performance computing chips are being used, in part, to mine for cryptocurrency.

"What it tells me is that this trend is real," Curzio explained. "It's a small, not meaningful part of their revenue. But if it takes off, if crypto goes to the next level, it has to flow through Taiwan Semi."

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