The Price of Graphics Cards Plummet in China After Bitcoin Mining Crackdown
Meanwhile, Nvidia Corp. continues to push for a chip just for cryptocurrency miners where the CEO said they “learned to move faster,” to prioritize its gamer customer base and immune themselves from the worst of any potential crash.
Prices of graphics cards have been plummeting in China following the latest crackdown on cryptocurrency mining.
The Nvidia Quadro P1000 model, an entry-level graphics card, is now available for 2,429 yuan (US$376) on a JD.com franchise store, down from a peak of nearly 3,000 yuan in early May.
Advanced card, Asus RTX3060 is also down at 4,699 yuan from its peak of 13,499 yuan in May on Tmall, operated by JD.com rival Alibaba Group Holding.
The crackdown on cryptocurrency mining has resulted in roughly 70% of Bitcoin mining capacity in China going offline, which is expected to be closer to 90% at the end of this month.
This has resulted in the hash rate falling to 87.3 TH/s, last seen in late October, down 50% from the mid-May peak.
Amidst this, Nvidia Corp. continues to ask crypto miners not to buy its latest high-end computer graphics chip, GeForce RTX 3080 Ti and the RTX 3070 Ti, to prioritize its core gamer customer base.
As we reported, in order to discourage miners from snapping all the supply, the company has deliberately stripped out the products’ ability to effectively mine cryptocurrencies.
According to Jon Peddie Research, an estimated 25% of the add-in graphics cards, about 700,000 cards for a total value of $500 million, were shipped in the Q1 of 2021 went to miners or people looking to resell them for a profit.
As such, Nvidia is specifically pushing a chip just for the miners. The company projects $400 million revenue in the second quarter from the introduction of these crypto-mining processors (CMPs) created exclusively for miners.
“With CMP, we learned to move faster,” said Jensen Huang, Nvidia’s chief executive officer. Huang thinks he’s inoculated the company from the worst of any potential crash caused by crypto-mining graphics card use and disposal, as happened in November 2018 when the company had to cut its annual sales forecast to $2.7 billion, $700 million less than analysts’ estimates that caused investors to dump the stock sending its prices down by 20% in two days.
According to Huang, crypto mining will continue, and digital assets are here to stay. At the Computex show this month, he told reporters, he’s hoping that cryptocurrency markets reach the size that will make the special-purpose chips a worthwhile investment.