Update, 12/7/17, 9:45am PT: The price of Ethereum has fluctuated wildly since our original piece and updates were published; meanwhile, the price of GPUs has done the same. We've updated this article substantially from the original to reflect current market trends.
What was possibly the worst GPU shortage in history has finally ended, but we might be about to face another one. As Ethereum once again gallops into the news, we examine the current market conditions in an attempt to determine if another shortage is possible, and also to find the best prices on GPUs.
The Price Of Ethereum
Following the Ethereum gold rush that saw the popular cryptocurrency peak at around $400 in June, Ethereum has had a rather shaky and unpredictable year. The cryptocurrency dropped to around $150 on July 16, climbed back to around $389 on September 1, and then rapidly dropped again to about $221 on September 15. Over the last few months, Ethereum’s value grew slowly until about a week ago, when it jumped to $493 on November 27. It is currently down to $436 at the time of publication, but could begin to rise again at any moment.
The Price Of Gaming (Or Mining)
With cryptocurrency mining making yet another come back, many in the PC industry will likely be concerned about a substantial GPU shortage like the one we observed this summer. But a serious shortage seems unlikely at this time.
One of the key factors that caused the GPU shortage this summer was an inadequate supply of parts from AMD, Nvidia, and their various OEM board partners. It is key to know here that these companies typically need to place orders for GPU cores months in advance with the fabs that produce them. When it was time for AMD and Nvidia to place GPU orders for summer 2017, it was impossible for these companies to predict with any degree of certainty that cryptocurrency mining would again flourish.
As cryptocurrency miners proceeded to deplete the OEMs' existing inventory, the companies were unable to respond to the increased demand in a timely fashion. The aforementioned fabs take orders from several companies, not just AMD and Nvidia, which prevented the GPU developers from expediently increasing production.
Months later, although the two companies are still unable to rapidly increase production if needed, they did increase production in the second half of 2017. This won’t eliminate the possibility of a shortage, but it will reduce the chance that one will occur.
Although there will certainly be some people eager to join the mining game, the number of new cryptocurrency miners buying up GPUs should be significantly lower than we observed this summer. Many interested in cryptocurrency mining likely already have their mining equipment from earlier this year.
The GPU market hasn’t changed much since the shortage this summer. AMD released Vega, and Nvidia released its GTX 1070 Ti, but these new GPUs don’t push the performance envelope forward. The GTX 1080 Ti is still the fastest single consumer GPU, and Nvidia’s GTX 1070 and GTX 1060 GPUs are still highly capable of mining Ethereum. The same goes for AMD Polaris GPUs. As a result, there isn’t much reason for miners to replace or upgrade their existing equipment.
As it stands now, GPU prices have not shown significant changes in price over the last couple of weeks. A few OEMs have reported a recent increase in sales, but they did not go into detail about exactly how large of an increase occurred. If you have been considering a GPU upgrade, now may be the best time to do it, just in case prices do start to climb.
Will there be a shortage?
A shortage may be unlikely at this time, but as Ethereum continues to grow in popularity and value, gamers and system builders should still keep their minds open to that possibility. Hopefully AMD and Nvidia have increased production sufficiently to avoid a shortage, but as we have learned in the past, the demand for GPUs can be highly unpredictable when cryptocurrency mining is on the rise. Keep watching here for more updates as the situation evolves.
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