Smart $$ going for the tech of bitcoin

When people talk of mining stocks, it generally references images of picks and shovels.

But for advocates of bitcoin and other cryptocurrencies, the gold is in the shares of companies that produce the computer processors and chips used to create the digital currencies in the process that’s known as mining.

A complete mining rig, which is made up of graphics cards, a processor, power supply, memory, cabling and a fan, costs between $2,400 to $3,800 on Amazon.com.

The following are some of the publicly traded companies that make the parts.

Nvidia: The company manufactures graphic processing units used by gamers and, increasingly, by digital-currency miners. GPUs listed in Nvidia’s Web site can cost as much as $1,200.

The rig-mining market could grow to about $1.3 billion, and with GPUs making up approximately 66 percent of coin-mining costs, the demand for GPUs could increase to $875 million, according to a RBC Capital Markets report.

Shares of Nvidia have climbed 45 percent this year, and have more then tripled in the past year.

Advanced Micro Devices: Also makes graphics cards used for mining ethereum and other digital coins.

The company’s shares have rallied the most on the Philadelphia Semiconductor Index in the past week, due in part to a PCWorld article that said it’s almost “impossible” to get AMD’s Radeon graphics cards after a recent surge in demand by digital currency miners.

The shares are up 27 percent in the past month, and have almost tripled over 12 months.

Micron Technology: Micron is the largest US maker of memory chips, one of the major components of any mining rig, so it also stands to benefit, Kevin Cassidy, an analyst at Stifel Nicolaus, said in his report.

Micron shares have surged almost 50 percent this year, and have more then doubled in the past 12 months.