GPU Shortage: A Major Crisis For Cryptocurrency Mining

GPU Shortage: A Major Crisis For Cryptocurrency Mining

With the increasing popularity of Blockchain technology and cryptocurrency, every other person wants to get connected with it. While some people are seen investing in this digital currency, others look forward to mine it using a computer’s Graphical Processing Unit (GPU) as a mining hardware.

Owing to this kind of indulgence, people are inquisitive to find out whether the resources for mining cryptocurrency enough? Are there any challenges that users face while mining Bitcoin? Is the Bitcoin mining hardware sufficient?

According to current statistics, manufacturers of GPU units are not able to meet up with the demand.

Bitcoin mining GPU
Img Src: Altcoin

Does this mean that GPU shortage puts cryptocurrency mining at risk? Is the future for Bitcoin mining secure? All these questions still stand unanswered.

This article includes, what GPU manufacturers think of this shortage and their vision to put an end to this shortage.

GPU Shortage, Why It Is There?

Everybody is seen talking about GPU shortages, but no knows the reason behind it. Is anyone keen to know why are manufacturers like AMD and Nvidia, falling short of GPU devices?

Well, if the solution was only to match the supply-demand chain, I guess there would have been no problem. What lies behind, is the worldwide shortage of dynamic random-access memory (DRAM) which are used in video RAMs such as GDDR5 and HBM2.

With the technological competition amongst mobile manufacturers, GPU manufacturers like AMD and Nvidia have started donating DRAM products to these mobile companies.

Owing to the major portion of DRAM products being bestowed to mobile companies, it is difficult to meet the demand and hence they fall short of Bitcoin mining hardware.

What Are The Price Tags Attached To GPU’s?

Price of a GPU totally depends on their demand. The increase in Bitcoin miners have increased the demand for GPU’s in cryptocurrency market. This demand has resulted in a price hike. For a high-end GPU like AMD’s Vega GPUs, which costed around 400 USD in past years, the current price has invariable increased and costs around 1000 USD currently.  Similar is with Nvidia’s GTX 1080s and GTX 1080 GPUs whose prices have increased by few hundred dollars.

A reversal scenario is seen with low-end units. According to 1st quarter, GPUs prices have declined for low-end GPUs. Zotac’s GTX 1080 Ti, with a previous price tag of USD 1,400 has now been reduced to around USD 920.

See Also: Is Cryptocurrency Killing Blockchain Technology?

What Nvidia Has To Say?

nvidia GGPU

Nvidia’s GTC conference held on March 27, 2018, saw CEO Jensen Huang’s vision about the production of GPU units for cryptocurrency market to meet up the current supply shortage.

As per him, the main aim of Nvidia is to dedicatedly produce GPU units both for gamers and cryptocurrency workstations. Current scenario depicts the shortage of GPU units for gamers and crypto mining which can be met when the company produces more and more units.

Jensen Huang takes the increased demand for GPU units for crypto miners as a positive sign and aims at working even more meticulously to meet the demands by producing more DRAM units.

What AMD Has To Say?

AMD GPU for bloackchain mining

AMD’s vision for GPU shortage does not match with Nvidia. While Nvidia is taking the rise in demand for GPU units as a positive sign, AMD has a different attitude towards it.

AMD as per its annual company report, released in February 2018:

“The cryptocurrency market is unstable and demand could change quickly. For example, China and South Korea have recently instituted restrictions on cryptocurrency trading. If we are unable to manage the risks related to a decrease in the demand for cryptocurrency mining, our GPU business could be materially adversely.”

Unlike Nvidia, AMD does not aim at meeting the demand for GPU units for Bitcoin mining, however, is focusing only on manufacturing more and more units to meet up the demand-supply chain.

Challenges and Probable Keys:

Earlier, people thought that ASIC mining manufacturers like Bitmain would rule the world, however the same doesn’t stand true. Although ASIC miners at first glance seemed unbeatable, the scenario has completely changed. The major reason behind this is the change in thoughts of organizations and cryptocurrency projects about their needs for ASIC struggles and decentralization of token supplies.

bitcoin mine challanges

It’s not that ASIC BTC is no more being used by people, however, many organizations and projects have now been seen deviating from it.

Does people’s deviation from ASIC mining good news for Nvidia and AMD? To some extent, it is. Since people are willing to use GPUs for mining, they have a good future according to the current demands. This, however, will only be possible if these organizations are able to meet the shortage of DRAM devices.

What About the Price Tag?

The price tag completely depends upon the availability of GPU devices. The prices are likely to settle down only when the DRAM shortage is fulfilled and Bitcoin mining hardware can meet up current demands.

Having said that, if Nvidia and AMD are unable to maintain a balance in the supply-demand chain, the price will vary as per the demand.

Cryptocurrency mining is at its all season high. However, due to the scarcity of Bitcoin mining hardware, Bitcoin miners are facing difficulties in mining cryptocurrency. It is still a big question, whether manufacturers like AMD and Nvidia are able to meet the demands or there is a serious threat to Bitcoin mining due to this GPU shortage?

As of now we can only wait and watch what future does it holds.

Next Read: Bitcoin Mining Hardware: A Glance

Pragya Dani is a technical blogger at Systweak. She loves exploring hidden and lesser known features of gadgets and all things tech. Pragya also likes trying out different cuisines and Italian tops her list

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