NVidia to Develop Chip Dedicated To Cryptocurrency Mining
As per a June 22 Twitter post by Bloomberg Crypto, chipmaker Nvidia pushes a chip dedicated to crypto mining. The move is meant to ease the shortage of the most popular video gaming cards, which crypto miners are increasingly using amid the ongoing digital currency craze.
Nvidia plans to make a chip dedicated to crypto mining to leave its top graphics chips just for gamers https://t.co/4GFzUFLRhQ
— Bloomberg Crypto (@crypto) June 22, 2021
The company has now urged non-gaming customers not to purchase its latest high-end graphics chips, which are exclusively reserved for hardcore gamers.
Gamers worldwide have complained that they can’t get their hands on NVidia’s top graphics processing units (GPUs), rendering ultra-realistic video graphics in real-time. That is because voracious miners have been snapping up most of the supply and repurposing the chips to crunch the complex cryptographic calculations needed to harvest crypto.
The battle for NVidia chips between gamers and crypto miners highlights the growing demand for digital assets. The development of a chip specifically tailored to crypto mining should hedge against the unrelenting miner demand and leave top graphics chips just for NVidia’s core gaming business.
Brokering a Truce Between Warring Clients
Nvidia has faced a tough time deterring crypto miners from using cutting-edge gaming chips with unrivaled computational power.
Back in Feb of 2021, the chipmaker limited the capacity of its RTX 3060 graphics cards to deter crypto miners from purchasing them. However, the tech-savvy miners quickly figured out how to reconfigure the chips to optimize cryptocurrency mining.
The California-based tech firm has now resorted to splitting the chip market in two to satisfy both its loyal gamers and the crypto mining community. To this end, the company plans to offer the Cryptocurrency Mining Processor (CMP) and GeForce chips to cater to miners and gamers, respectively.
CMPs are based on an earlier version of NVidia’s gaming cards but have been stripped of all graphic-rendering outputs to optimize them for mining. On the other hand, GeForce cards carry the latest graphics technology from NVidia but have the so-called hash rate slowed down to make them inefficient for crypto mining.
In a May 26 conference, Nvidia CEO Jansen Huang explained the strategic decision to roll out a crypto mining chip.
“What we hope is that the CMPs will satisfy the miners… [and] steer our GeForce supply to gamers. Hopefully, in the combination of those two, we’ll see strong growth in our core gaming business through the year.”
Crypto Mining Chips to Make Millions for NVidia
NVidia predicts that its CMP chips could rake in a staggering $50 million in revenue in Q1 of next year. However, despite acknowledging the lucrative yield-earning opportunities its crypto mining business brings, the chipmaker is wary of having its revenue streams tied to the volatility in crypto markets.
According to BoA analyst Vivek Arya, NVidia’s priority is to keep its loyal gaming customer base happy, as they will be around long after the demand for CMPs dries up with the next bear market.