Cryptocurrencies, large and small, are going through a difficult time right now, with unprecedented falls and losses that can take some time to recover.
Given that graphics card prices are often affected by the situation in the crypto market, can we expect to see an improvement in the state of GPU shortage?
The cryptocurrency market is quite volatile in the best days, but last week was one of the toughest the world of cryptocurrencies has ever seen. After the peaks of November 2021, the major cryptocurrencies, Bitcoin and Ethereum, suffered a severe blow. As usual, these scams resonated throughout the market and you would have a hard time finding a currency that was not hit. As a result of this crash, some $ 800 billion in market value has disappeared from cryptocurrency assets, Reuters reports.
It’s no mystery that the price of graphics cards is a delicate issue these days. With the current shortage of GPUs and the supply problems they entail, it certainly doesn’t help that cryptocurrency miners tend to buy suitable GPUs en masse for mining. However, as cryptocurrency prices plummet, we are likely to see shock waves hit the graphics card market soon.
For those who want to buy a graphics card, the stars may be about to line up. We have Nvidia and AMD about to launch their next-generation graphics cards, which – at least in theory – should affect the price of the cards that are on the shelves right now. Intel is also set to launch new GPUs, but with all the recent delays and the fact that they won’t be able to compete with Nvidia and AMD’s next-generation offerings, that will only have an effect on the mid-range and entry-level sections. of the market.
In times of scarcity, PC buyers have had to deal with GPUs that run out quickly and, if in stock, are overpriced. Cryptographic mining certainly plays a role in this. With the cryptocurrency market in its current state, mining will be much less profitable and the cost of a GPU and the maintenance of a mining farm may not be worth the money and trouble in these circumstances. Ethereum is also set to move to a participation test model soon, though it is a moving goal post. If and when this happens, it will be another nail in the coffin for cryptographic mining.
As the demand for mining cards drops, the supply for regular users will naturally increase. Many used cards can also re-enter the market. However, the cryptocurrency market will most likely recover sooner or later, and then we can see that GPU prices are rising again. It all depends on the offer.
What happened, and how did it start?
It is important to note that the financial market as a whole has been experiencing for some time the signals of a so-called bear market, so things have been difficult for cryptography in recent weeks as it stands. However, this huge crash brought Bitcoin to a current low of $ 28,000, which is less than half its value in November ($ 67,000 at its peak), and caused Ethereum to fall below $ 2,000 for the first time in almost a year. It all started with the destabilization of something called “stablecoin” called TerraUSD.
Stable currencies are cryptocurrencies that are linked to a fiat currency, which means that they are supposed to maintain a value similar to that of a non-digital currency. In the case of TerraUSD (UST), as expected, it was supposed to be pegged to the US dollar. Unlike other stable currencies, UST used another cryptocurrency, Luna, to maintain its dollar. When Luna’s value mysteriously fell by a staggering amount, dropping from $ 116 in early April to less than a dollar from now on, it dragged TerraUSD down.
At its lowest point, TerraUSD fell to 30 cents. Note that it is supposed to maintain a value similar to that of the US dollar, so dropping from about $ 1 to $ 0.30 is a massive drop for a currency that is often considered a safe way to store money without exposing itself to the volatility of others. currency. cryptocurrencies. To save it, the creator of TerraUSD spent about $ 3.5 billion on Bitcoin. With such a huge amount of money suddenly entering the market, the very value of Bitcoin has dropped.
We are still in the early days of this latest cryptocurrency crash, and it is worth remembering that while cryptocurrencies are struggling, the shortage of GPUs is being affected by more than just a high demand for cryptocurrency mining. However, since we’ve seen improvements in all areas and with next-generation cards on the horizon, it may soon be a good time to start checking out some of the best GPUs.