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Nvidia Racks Up 300,000 Overstock GPUs As Mining Interest Dwindles

Nvidia-According to an article from Gadgets360, a popular technology media source, an over 300,000 GPU return was the result of a ‘top 3’ Taiwan OEM realizing the lack of demand in the computer hardware market.

Some have suggested that the recent influx of overstock GPUs will lead to a delay in the release of a new lineup of Nvidia cards, originally expected to arrive in Q2/Q3 2018. This would make sense, as Nvidia would want to sell all of the cards in their 10 series before making any large moves towards new hardware. If the aforementioned reports are accurate, Nvidia’s overstock can be worth over one hundred million dollars at MSRP prices.

The rumored 11 (Ex. 1180) series cards have become an important topic of discussion in the technology and cryptocurrency communities. Both groups believe that the performance of these new cards will easily overpower any of the GPUs from the previous series.

Nvidia Refocuses on Gaming As GPU Mining Slows

However, Nvidia has begun to quash the hopes of GPU miners, by announcing that they will begin to refocus on gaming, instead of the immense profits produced by the GPU mining sub-sector.

Jensen Huang, Nvidia’s CEO, said:

We’re working really hard to get GPU down to the marketplace for the gamers and we’re doing everything to advise retailers and system builders to serve the gamers. And so, we’re doing everything we can, but I think the most important thing is we just got to catching for supply.

Nvidia revealed that revenues from the cryptocurrency industry amounted to $289 Million, nearly 10% of all reported revenue streams. Although this figure represented a substantial amount of sales, Jensen expects a ⅔ decrease in cryptocurrency demand over Q2.

With Q2 coming to a close shortly, it is clear to see that GPU demand has gone down, but exact numbers are still unclear. Many have attributed the mining demand slow-down to decreasing cryptocurrency prices, along with the rise in prominence of ASIC miners.

Firstly, cryptocurrency prices have declined over 70% since the start of the year, with mining difficulty still rising. This has led to an unsustainable market for GPU miners, with many users reporting a large loss in mining profitability. A select few, who live in areas where power costs exceed average levels, have begun to shut down their mining farms entirely, as profitability goes out the window.

GPUs Lack Efficiency When Compared To New ASICs

Secondly, Bitmain has recently announced their expansion into new mining algorithms, unexpectedly releasing ASICs for ETHhash and Equihash. Coins mined on the two aforementioned algorithms have historically been mined on GPUs, with Ethereum and ZCash being the most popular cryptocurrencies on these algorithms.

The new ASICs, titled the E3 and Z9 Mini, produce an exponential increase in the hashrate/$ performance metric. Ethereum and ZCash were originally expected to hard-fork away from any ASIC miners, however, developers have been slow to make any moves towards ASIC resistance. As the aforementioned ASICs arrive at the homes of miners, mining difficulty will begin to rise to new heights, heights where GPU miners will be unable to reach.

The GPU mining market is in a precarious situation, as profits slow. Nvidia has begun to acknowledge this, with analysts expecting a similar situation to occur with another hardware manufacturer, AMD.