GPU Insane Price and BitCoin Miners

[THartmann9374]

Hello all,
I don't understand why GPU's price increased so much just because of bitcoin miners? Also, what do bitcoin miners have to do with GPU? I mean, why 1070, but could use like 950 or 970.

I bought MSI NVIDIA 1070 8 GB for 400 dollars last April. Then I checked online just curious and found that it is now over 500 dollars!

Thanks, Tom

 

[mrmez]

Supply and demand.
A quick google search will probably tell you more about bitcoin and how it works.

 

[derekullo]

Bitcoin miners use gpus to turn processing power into cash.

You want a powerful gpu that is able to use the least amount of power because power is what they are spending to turn gpu computations into cash.

The 970 uses 145 watts and the 1070 uses 150 watts.

But the 1070 is much more powerful and is able to make up those 5 watts with more computations.

From what I have read the Geforce 1080s have GDDR5X memory which is not good for mining for some reason, therefore those prices have stayed relatively the same, $500ish for cheapest models.

On top of this bitcoin miners build in scale.

They won't buy 1 or 2 cards like a gamer would.

They could buy 8 cards for each of their systems they want to build.

I don't know the model of the motherboard but I saw one the other day with space for 8 graphics cards.

But eventually this will pass due to the calculations required to generate money getting more and more complex, slowing down the speed while keeping the power requirement steady.

At some point the price of the cash made will equal the price of the electrical power used to make it, making the net gain 0.

This is when miners will stop buying gpus and switch to ASIC and other fancy mining equipment that are even more power efficient.

 

[cryoburner]

Technically, this price hike isn't due to Bitcoin at all, but rather some other, newer cryptocurrencies like Ethereum. Using GPUs to mine Bitcoin hasn't been profitable for years, since specialized mining hardware came out that was far more efficient at the task, making GPU mining of Bitcoin obsolete.

These newer currencies are designed to make it difficult to use that kind of specialized hardware, so at least for the time being, graphics cards are what gets used. The GPUs perform complex cryptographic computations, the results of which are chains of numbers, which are all the generated money is. As more currency gets mined, it becomes computationally harder to mine additional currency, resulting in a limited pool of money.

Since the cost of electricity factors into how much profit can potentially be made, a mining system will typically have multiple cards installed to reduce the overhead of other components. And some larger-scale operations will be running many of these multi-GPU systems, basically like a money-factory. And this is where a lot of the GPUs go.

Since the production of graphics cards is limited by what the manufacturers expected to be selling for normal purposes months ago, the supply of upper-mid range cards has become limited, since those are the cards that tend to offer the best efficiency in terms of profit over operational costs. And the card manufacturers don't necessarily want to ramp up production either, since these alternative currency markets can be volatile, and if mining with these GPUs becomes unprofitable in a couple months, there will be a ton of cheap cards available on the secondhand market, making it hard for manufacturers to offload all the additional cards they would have made.