Cryptocurrency Mining: AMD to Boost Production of Graphics Cards
AMD has announced plans to boost its production of graphics cards amid a global shortage with demand for them driven by their use in mining cryptocurrencies.
AMD released earnings for Q4 2017 on Tuesday, announcing revenues of $1.48 billion , a 34 percent year-on-year increase. Of that total revenue, the company’s Computing and Graphics division contributed $958 million, up 60 percent from the same quarter in 2016.
Demand for GPU processing power has surged due to a spike in interest from the blockchain and cryptocurrency community. In an investor call, AMD CEO and president Dr Lisa Su told investors that the cryptocurrency mining market was “a good part of our business.”
Graphics card shortages have become an increasing dilemma facing both AMD and its main rival Nvidia. Over the past year, prices of Nvidia’s graphics cards have surged, with GeForce GTX 1050 Ti cards increasing by 27 percent, GeForce GTX 1060 3GB cards by 86 percent, GeForce GTX 1060 6GB cards by 89 percent, and GeForce GTX 1080 Ti cards by 59 percent.
According to a TechRadar review, Nvidia’s GeForce GTX 1070 was the best-suited graphics card for cryptocurrency mining. It boasts a high hashing rate and low power consumption, the perfect combination of features for cryptocurrency miners looking to mine Bitcoin, Ethereum and other coins.
Bitcoin mining, in particular, is becoming increasingly difficult by design as its circulation climbs and approaches its supply limit. Of the total 21 million Bitcoins that will ever be mined, there are currently almost 17 million in circulation, according to Blockchain.info .
As mining complexity increases, processing power needs will rise accordingly. In 2017, Bitcoin miners used as much as 36 terawatt hours of energy, according to CCN.com. Recent analysis suggests that the Bitcoin network consumes more electricity than 159 individual countries. It sits just behind Singapore in terms of electricity consumption.
GPU supply woes have hit gamers hard. AMD’s XFX Radeon RX Vega 56 graphics card, released in August last year, sold out within 5 minutes. Only months before, AMD’s Radeon RX 580 and RX 570 models were listed as sold out at most major retailers including Amazon, Newegg and Best Buy.
As AMD and Nvidia continue to see GPUs run out of stock and customers often buying them in bulk, both companies are working hard to ensure their loyal gaming fans are not priced out of the market. Nvidia has even resorted to asking retailers to limit single purchases to two cards.
Supply shortages have spiked in the past. In 2013, Bitcoin and Litecoin GPU-based mining drove demand for the cards. Last year, it was Ethereum and Bitcoin mining that attracted the attention of miners. With China’s recent decision to force cryptocurrency mining out of the country, the shortage of mining power is only going to become more acute.
AMD’s recent announcement that it plans to ramp up production will come as some relief to both the gaming and mining communities. While the supply of silicon is not causing production constraints, the company faces shortages of both GDDR5 and HBM2 memory.
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