The GPU demand for the cryptocurrency mining increased significantly earlier this year with the sudden boom in cryptocurrency. However, as fast the cryptocurrency craze went up it came down just as fast and reportedly we are about to see a short-term increase in GPU demand for cryptocurrency mining.
According to Economic Daily, there will be a short-term boost in GPU demand for cryptocurrency mining. The report reveals that cause for the surge in GPU demand is the flood in the Sichuan province of China.
According to the report, Sichuan province is the prime location of the 70% of mining systems running in China. The flood has destroyed tens of thousands of mining systems in China.
Not only that, the report has revealed that with these cryptocurrency mining systems destroyed in China, mining calculation has dropped by 30% and the Bitcoin mining hashrate has dropped from ~43TH/s to ~30TH/s in just over a week.
Tens of thousands mining systems in Sichuan have been damaged in the flooding, cutting the overall mining calculation by around 30% worldwide, noted the report.
However, this doesn’t necessarily mean that we will see a shortage of GPUs in the market and inflated prices like in early 2018 as many of the mining fams have moved up to ASIC Miners.
For those who don’t know, ASIC miners are application-specific integrated circuits which are designed for one purpose and that is to mine cryptocurrency.
ASIC miners are much more efficient at mining cryptocurrency compared to GPUs but these machines are also expensive compared to the graphics card.
Bitmain is one of the leading ASIC manufacturers and contributes around 50% of worldwide hashing power for Bitcoin.
Aside from Bitmain, Samsung is also jumping into the ASIC mining business and the company has announced that it is manufacturing ASIC chips.
This report is the exact opposite of the earlier report that GPU shipments to plummet due to Low cryptocurrency demand. Reportedly, Nvidia and AMD AIB partners expected GPU shipments to plummet because of the low demand of GPUs for cryptocurrency mining.
However, the situation has changed as ten of thousands of mining systems have been destroyed in the flood which will eventually lead to a short-term surge in GPU demand.
With this short-term surge in GPU demand, we might see GPU shortages but of course, the shortage will also be short-term. However, this short-term surge might contribute to increase in GPU prices.