Graphics processing units, popularly used for mining cryptocurrencies, are falling in price, as Ethereum hopes to migrate to a proof-of-stake model.
GPU prices are falling, and one of the reasons for the decline could be weak demand for cryptocurrency mining. While GPUs are considered essential hardware for cryptocurrency mining based on the proof-of-work consensus mechanism used by many popular cryptocurrencies, including bitcoin, Ethereum’s switch to a proof-of-stake model effectively serves that purpose. would make them redundant. Last year, an increase in the price of Ethereum caused a similar increase in the price of GPUs.
price drop
Although GPU prices have dropped, they are still being sold at a premium, even if they are small. The manufacturer-suggested markup has dropped the retail price, or MSRP, from 77% to 41%, said Susquehanna analyst Christopher Rowland. Additionally, the price of AMD’s Radeon RX6000 and Nvidia’s GeForce RTX30, according to graphics chips and hardware news site 3DCenter, steadily dropped from less than 20% to 80% off MSRP at the beginning of the year. However, Reuters reported that Nvidia’s GeForce graphics cards were still unavailable at retailers such as BestBuy and Newegg Commerce.
Meanwhile, the Philadelphia SE Semiconductor Index is down 22% this year, Nvidia shares are down about 31%, and rival Advanced Micro Devices is down about 37%. Earlier this year, hackers claiming to have infiltrated Nvidia servers attempted to sell a way to unlock graphics cards for Ethereum mining.
After the drop in GPU prices, Baird analysts moved Nvidia to “neutral”, but Bank of America still believes that weakness in the crypto mining segment could be complemented by demand from data centers, Confirms its “buy” rating for Nvidia.
lack of chip
Others speculate that a drop in graphic chip prices could lead to an unexpectedly quick end to the global chip shortage. The issue is certainly important for companies reporting results this week, including Intel, which is planning a multi-billion dollar expansion, and Qualcomm.
Other processors such as CPUs and some memory chips have also seen their prices drop due to a decrease in demand from the PC and smartphone markets. Summit Insights Group analyst Qingai Chan forecasts higher supplies of some other chips built on older machines in the second half of this year.
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