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HAVE YOU NOTICED A LACK OF GRAPHICS CARD AVAILABILITY RECENTLY? YOU’RE NOT ALONE. MARK WILLIAMS LOOKS AT WHY THE RESURGENCE OF GPU MINING HAS CAUSED THE SECOND CRYPTO CRISIS
itcoin. The currency that is as confusing as it is astounding. So confusing in fact that the respected financial journalist Alan Kohler reported on the ABC nightly news as Bitcoin being a commodity (because work goes into producing it), then the following night completely switched tack and reported on it as a currency.
Bitcoin has gone from strength to strength and at the time of writing one Bitcoin is now worth around $3,500. For something you can eectively generate out of thin air you can see why people are interested in mining (generating) it.
However, these days mining Bitcoin is basically out of the question. You see as more Bitcoins (or any crypto currency it seems) are made they progressively get harder and harder to generate, with the amount of computation required increasing with each consecutive “coin” made. In the first crypto crisis that occurred a year or two ago now, when Bitcoin was really the only currency around, GPU mining of Bitcoins was so profitable that graphics cards, particularly AMD ones, were snapped up by miners leaving gamers and system builders without stock. But once Bitcoin got so hard to mine by GPU, specially designed ASIC miners from the likes of Bitmain with their Antminer line of products were soon exceeding GPU production rates and the graphics card market returned to normal as the crypto demand vanished.
Since then Bitcoin has been mined so much that it’s very hard to produce any more of it easily. With the explosion in other digital currencies however, cryptocurrency miners are once again having a field day.
Ethereum is now probably the second biggest digital currency and just so happens to be very easily mineable currently on GPUs, again on AMD cards in particular. With one Ethereum hovering around the $290-mark (up from $10 at the start of the year) miners are once again snapping up graphics cards like they’re potato chips and have eectively caused the second crypto crisis in the GPU market with most AMD and some Nvidia cards now out of stock or in very limited quantities.
James from Umart estimates that it has caused a roughly 20% uptick in card sale values.
It’s so popular in fact that it has been estimated that all the miners currently generating Ethereum are consuming about 4.2TW of power, more than the consumption of country of Cyprus!
While the demand for graphics cards for this task is expected to last several more months, with some expected changes coming to Ethereum itself and with the rising complexity of generating it, the current feeling is that by years end GPUs won’t be so good at mining it anymore and could see the market cool once again.
With so many other digital currencies now though I wouldn’t be surprised if this all happens again Groundhog Day style but with some other up-and-coming currency. Time will tell.