Reports show that Nvidia has just had over three hundred thousand graphics cards (GPUs) returned, with the returns being credited to a huge decrease in demand for their newest lineup of cards. According to an article from a well known technology media source called Gadgets360, over three hundred thousand GPU return was because of a ‘top 3’ Taiwan OEM realizing the lack of demand in the computer hardware market.
Others have mentioned that the recent influx of overstock GPUs will lead to a delay in the launch of a new lineup of Nvidia cards, initially expected to arrive in Q2/Q3 2018. This would make sense, as Nvidia would want to trade all of the cards in their ten series before making any huge moves towards new hardware. If the previous mentioned reports are accurate, Nvidia’s overstock can be worth over one $100 Million at MSRP costs.
Nvidia returns focus on gaming
Nvidia has however begun to crash the hopes of GPU miners after revealing that they will begin to refocus on gaming, instead of the immense profits produced by the GPU mining sub-sector. Nvidia announced that revenues from the crypto industry amounted to $289, nearly 10% of all reported revenue streams. Although this figure represented a substantial amount of sales, Jensen Huang, Nvidia’s CEO, expects a two third decline in cryptocurrency demand over Q2.
Cryptocurrency costs have decreased over 70% since the beginning of the year, with mining obstacle still increasing. This has led to a not sustainable community market for GPU miners, with many users reporting a large loss in mining profitability.
GPUs and new ASICs efficiency comparison
Bitmain has recently reported their indulgence into new mining algorithms, surprisingly launching ASICs for ETHhash and Equihash. Coins mined on the two algorithms that were reported before have historically been mined on GPUs, with ZCash and Ethereum being the most knowned cryptocurrencies on these algorithms.
The recent ASICs, titled the E3 and Z9 Mini, produce a huge increase in the hashrate performance metric. Ethereum and ZCash were initially expected to hard-fork away from any ASIC miners, however, inventors have been slow to make any moves towards ASIC resistance. As the mentioned ASICs arrive at the premises of miners, mining difficulty will start to rise to new levels. Levels that GPU miners will not be able to reach.
The GPU mining market is in a precarious situation, as profits decrease. Nvidia has started to appreciate this, with analysts expecting the same situation to happen with another hardware manufacturer, AMD.