Downfall of Cryptocurrency Mining forces vendors to cut down the GPU prices

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In late 2017 and early 2018, the graphics cards prices leaped to unprecedented heights due to cryptocurrency mining. These graphics processors were the ideal choice for setting up a small mining rig. But now with the downfall of these digital currencies, the trend seems to be reversing.

Approximately three million GPUs worth of $776 million were sold back in 2017. Now with the sharp drop in major digital token values, people are selling out their vendor GPUs in order to cover up some loss.

According to Robert Dow, manager of digital media at Jon Peddie Research,

“We have predicted a drop in [application specific processors] as [digital] currencies prices dropped. The cost to run the mining rigs is not insignificant, so when the price for the currencies drop…, people will run rigs and choose to dump AIBs on the secondary market hoping to recover some cost.”

The vendors have cut down the prices to increase the sales and to clear out the excess inventory. People are getting out of the mining business which has greatly reduced the demand of these graphics processors.

Nvidia and AMD have dipped their profit to unsatisfactory level but this has helped them to pick up the demand for the graphics card. Up until now the Radeon RX580 and its predecessors’ costs have been declining rapidly, same is the case with Nvidia GeForce GTX 1060 and GTX 1070, according to the sources.

The vendors are still under pressure as the inventory digestion process may not end until mid- to late-2019, the sources said. Nvidia is planning to release a new line of mid-range GPUs to maintain their profitability. New graphics card are currently the only source of to earn a little for these vendors.

AMD is under pressure with the release of new Nvidia cards and the price cut down. They are facing strong competition and will have to lower their price tags in order to survive in the market.

But how much decline we will see in the prices? According to DigiTimes, the vendors may shift to the loss-making territory, just to clear out the excessive inventory.

This drop in price is good news for tech and gaming enthusiasts who have been angry with the spiked prices due to cryptocurrency mining. Meanwhile, this can also delay the release of the upcoming AMD Navi graphics cards as they might want to clear out their current inventory first.

So this is all up in the GPU industry as of now. If you have any queries then make sure to drop down a comment below.

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