Bitcoin craze triggers graphics card buying spree

NVIDIA TITAN Xp graphics card

By Park Jae-hyuk

Korea’s unprecedented enthusiasm for bitcoin and other cryptocurrencies this year has led to the sales of graphics cards skyrocketing at domestic online marketplaces, making them the bestselling item of the year, data showed Tuesday.

According to SK Planet, overall graphics card sales at the company’s e-commerce platform, 11st, rose 67 percent from a year earlier between the Jan. 1 and Nov. 30 period.

Also, the most popular item on 11st in terms of sales was the NVIDIA TITAN Xp graphics card, a high-end model targeting gamers and experts who need high-performance graphics processing units (GPU).

An SK Planet official attributed the huge popularity of graphics cards to the nation’s growing interests in high-quality games, deep learning and virtual reality.

Given that GPUs, semiconductor chips in graphics cards, have been used for quicker mining of cryptocurrencies, however, the nation’s cryptocurrency fever this year can be regarded as another reason for such a huge increase in sales of high-end graphics cards.

When bitcoin’s price continued to soar in the first half this year, graphics cards were even in short supply.

Consumers who need the hardware for different purposes could not get the products, so manufacturers have come up with mining-only graphics cards and other related equipment.

The supply managed to catch up with demand in the second half but uncertainties remain because the demand for graphic cards does not show any signs of abating.

Still, many Koreans are mining bitcoin and other cryptocurrencies by using graphics cards just like other countries like China where so many miners provide computing power to get digital tokens thanks to the nation’s relatively low electricity prices.

Observers are split into two opposing camps whether or not the demand for graphics cards will remain strong.

Some claim the popularity of graphics cards will continue for the time being because more than 1,000 alternative virtual tokens keep attracting miners who have to buy the products.

According to industry officials, the world’s most famous graphics card manufacturers NVIDIA and AMD posted over $200 million in additional profits in the second quarter this year, due to the bitcoin craze worldwide.

But critics say the trend will finish soon. According to a recent report published by Morgan Stanley analyst Joseph Moore, the demand boost was only temporary, and could drop off significantly next year.

“Contrary to popular belief, bitcoin is irrelevant to graphics vendors, because it moved to application-specific integrated circuit chips several years ago. Instead, most graphics-based mining is being driven by bitcoin rival Ethereum at this point,” Moore said.

“We believe total graphics card sales for Ethereum mining in 2017 will be $800 million or so, and will decline by 50 percent in 2018. We can validate the 2017 number by looking at the increased complexity of the algorithm.”