According to reports, falling Ethereum and Ethereum Classic prices have severely impacted GPU prices in the open market.
Prices of Ethereum GPU Mining Rigs Falling
With ETH sliding to as low as $980 last week, GPUs, which are graphic cards deployed primarily by Ethereum miners who can also mine Ethereum Classic’s ETC and other Ethash networks, has been trading below the manufacturer’s retail price (MSRP).
According to reports, the Nvidia GeForce RTX 30-series and AMD’s Radeon RX 6000 GPUs are now at 14 and seven percent, respectively, above the MSRP. This is a notable contraction because they were trading at around 19 and 12 percent above their MSRP in April, pricing out most gamers but favoring crypto miners.
This is the first time Nvidia GeForce RTX-30 GPUs have dropped by over 10 percent above the MSRP, an indicator of the adverse effects of crypto winter on rig demand. Observers maintain that as the crypto prices change, GPU prices in the secondary market would likely fall further to the original price tag.
Globally Distributed Miners secure Ethereum
Ethereum is safe because of miners operating among many NVidia and AMD GPU rigs and pooling their computing powers through several pools for a chance to receive block rewards.
In Ethereum, block rewards are distributed every 14 seconds, and a successful mining pool receives 2 ETH, worth over $2.2k at press time. However, while these rigs are ideal and profitable to deploy, rig profitability depends on, among many factors, token prices. Since November 2021, ETH mining profitability has been on a downtrend due to falling crypto prices.
Current figures reveal that miners receive significantly lower USD value than at the peaks of the crypto run of 2021, when ETH soared to as high as $4.5k before cooling down to spot rates. With rising ETH prices, GPU prices spiked to record, causing scarcity.
This development saw GPU manufacturers like Nvidia make statements, declaring the release of GPUs tuned for other functions but not mining ETH.
Shift to a Proof-of-Stake Energy Efficient Consensus Algorithm
Environmentalists say crypto mining is unsustainable. They further accuse miners of unwinding efforts by governments to tackle climate change.
Ethereum plans to shift from a proof-of-work to a proof-of-stake consensus algorithm, replacing miners with validators.
The shift would relieve ETH bulls from the constant selling pressure by miners who have to sell coins to meet rising operational costs.
- ethereum feature image blockmagnates (1): Photo by Nenad Novaković on Unsplash