NVIDIA is against Cryptocurrency Miners buying its Gaming GPUs owing to impressive hashing function capabilities.
NVIDIA has decided to make its new RTX 3060 gaming GPU “unsuitable' for cryptocurrency miners by cutting its hash rate in half -- which accounts for its mining efficiency. NVIDIA will implement the change via the GPU's software drivers, which will detect and throttle the mining algorithm for Ethereum and other cryptocurrencies.
Ethereum is one of the few cryptocurrencies that can still be easily mined for a profit with mainstream gaming GPUs. Many other cryptocurrencies, including Bitcoin, however are now tough to mine profitably without a high-end ASIC (application-specific integrated circuit) miner.
It might not make any sense why NVIDIA would want to discourage miners from buying its GPUs, but the cause lies in what happened to it back in 2017 and 2018.
Back in 2017, prices of cryptocurrencies soared through the roof, and a whole new range of new ICOs (initial coin offerings) flooded the market. Many of those coins could be mined with NVIDIA and AMD's gaming GPUs. Those ambitious miners attempting to cash in on the crypto gold rush bought dozens of cards at a time, which beefed up market prices and caused actual PC gamers to postpone their upgrades. But since the crypto bust in 2018, the same miners dumped their used GPUs and flooded the market with cheap cards. To NVIDIA's dismay and apparent loss, many PC gamers bought those secondhand cards instead of its newest GPUs.
So in effect the data shows that NVIDIA's GPU sales surged in fiscal 2018 (which ended in January 2018) and throughout most of 2019. However, its total revenue then declined year over year for four straight quarters -- from the fourth quarter of 2019 to the third quarter of 2020 -- as it struggled with the blight of secondhand mining GPUs.
NVIDIA gradually recovered throughout fiscal 2021, as many cryptocurrencies either faded away or became unprofitable to mine with gaming GPUs. Solid demand for its new RTX GPUs throughout the pandemic and strong sales of its high-end data center GPUs amplified that recovery.
However, NVIDIA having learnt from the past realizes that the rising price of certain cryptocurrencies, including Ethereum -- which surged nearly 600% over the past 12 months -- could cause miners to again start stocking its newest GPUs.
So instead of having to get caught with its pants down again, NVIDIA is proactively making its GPUs averse to miners -- which could prevent another bubble from forming and disrupting its sales of GPUs to PC gamers.
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