There are plenty of reasons for investors to love chip makers NVIDIA Corporation NVDA 2.69% and Advanced Micro Devices, Inc. AMD 2.88%, such as their roles in the high-growth fields of gaming and artificial intelligence. But the exploding popularity of cryptocurrencies such as bitcoin and Ethereum has created a real under-the-radar demand for AMD, Nvidia and other chip makers.
On Wednesday, CNBC reported that Nvidia will launch a new line of graphics cards designed specifically for cryptocurrency mining.
Crypto Mining
“ASUS Mining P106 enhances the megahash rate by up to 36% compared to cards in the same segment that are not tailored for mining” the product listing reads. The ASUS Mining P106 is powered by the Nvidia chip.
The Nvidia mining chip and the booming share prices of Nvidia and AMD in the past year have coincided with an explosion of popularity in cryptocurrency mining, particularly in China and Eastern Europe. Miners are buying desktop graphics cards hand-over-fist to mine bitcoin and Ethereum, two of the most popular crypocurrencies.
In fact, RBC Capital reported that cryptocurrency mining alone accounted for more than $100 million worth of GPU sales for Nvidia in just a week’s time.
Surprisingly, GPUs are used more commonly to mine ether than bitcoin. As bitcoins have become harder and harder to mine, most miners have instead switched to application-specific integrated circuits to perform the heavy lifting involved in bitcoin mining. Ether, on the other hand, was specifically designed to be mined by GPUs and consume less electricity in the process.
Early Winner?
When it comes to picking a cryptocurrency winner between AMD and Nvidia, the jury is still out. Prior to the launch of Nvidia’s new cryptocurrency graphics cards, Bernstein analyst Stacy Rasgon said the Ethereum algorithm ran better on AMD’s GPUs than Nvidia’s. However, AMD’s GPUs were…
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