While cryptocurrency mining has helped some companies survive the constraints of last year’s pandemic, the picture has changed dramatically in recent months. With the price of Ethereum and other cryptos falling, miners are creating a flood of graphics cards in the market, pushing the price of products down.
Besides the bear market, another point that may be of concern to miners is the migration from Ethereum to Proof-of-Stake (PoS). The transition is planned for later this year and will render graphics cards useless.
As for Ethereum’s hash rate, it is down about 15% from the beginning of this month. So this is a good indication that more GPUs will hit the market after the migration, pushing the price down even further.
Mining, more volatile than cryptocurrencies themselves
Besides the fact that mining is dependent on the price of cryptocurrencies, it is noticeable that periods of abundance do not last long. After all, new miners enter the company until the return is no longer so attractive.
Last year an unusual situation arose. When governments closed branches, the price of cryptocurrencies skyrocketed. As a result, some LAN houses discovered that mining could be a solution to avoid bankruptcy.
However, after more than a year, the situation has changed dramatically. Due to the high competition, observable by the difficulty or hash rate of the network, and mainly by the bear market, the mining activity is not that profitable.
While former miners have already experienced this scenario in 2018, as can be seen from the chart above, the current situation is different. In addition to the price drop, Ethereum is also about to give up mining for graphics cards.
Video cards are auctioned
Due to the above points, some miners have already started dumping their used graphics cards on the market. Via Twitter, user Hassan Mujtaba notes that LAN houses in Asia and miners in China have started auctioning large quantities of GPUs.
“The stream of video cards is here.”
GPU flood is here.
Chinese miners and South Asian cafes are now dismantling their mining rigs and putting cards up for auction via live streams.
3060 Ti goes for $300-$350 US… pic.twitter.com/kphmIt7vZw
— Hassan Mujtaba (@hms1193) June 21, 2022
He goes on to note that NVIDIA’s 3060 TI can already be found for US$300, which equates to R$1,550. By comparison, this model sold for R$7,000 last year, a hefty discount for gamers.
Finally, more graphics cards are expected to hit the market after the migration from Ethereum to PoS. However, it is necessary to exercise some caution at the time of purchase and, for example, purchase equipment that has been exposed to excessive heat.
Source: Live Coins
John Cameron is a journalist at The Nation View specializing in world news and current events, particularly in international politics and diplomacy. With expertise in international relations, he covers a range of topics including conflicts, politics and economic trends.
