Graphics processing unit prices fall alongside cryptocurrencies

July 12, 2018
Chris Wheal

Prices for the graphics processing units known as add-in boards (AIBs) that are used in cryptocurrency mining hardware have been falling in recent days along with the price of digital tokens.

Graphic processing units at a cryptocurrency mining operation

While more commonly used in high-end gaming gear, the processing power that AIBs enable have made them popular for cryptocurrency mining units and were in peak demand during the crypto boom at the end of 2017 and beginning of 2018.

3 million sold in 2017

Analysis undertaken by Jon Peddie Research in February showed that more than three million add-in boards were sold to cryptocurrency miners in 2017, worth $776m.

Indeed, gamers struggled to get their hands on appropriate gear at the beginning of 2018, but in an email message to Computerworld, C Robert Dow, digital media manager at Jon Peddie Research said: “We have predicted a drop in processors as cryptocurrency prices dropped.”

He added: “The cost to run the mining rigs is not insignificant, so when the price for the currencies drop…, people will run rigs and choose to dump AIBs on the secondary market hoping to recover some cost.”

Crypto price drop

In mid-December the price of bitcoin peaked at $19,870.60, according to data from Such was the clamour for AIBs that in April AMD’s top end OEM 4GB RX580 six-pack cost $3,600 and almost impossible to source.

Bitcoin is currently languishing near the $6,200 mark and the same AIB six-pack is selling for around $2,500.

Dow added: “We also suspect that NVIDIA and AMD have some built up inventory, and that will affect average selling prices as well.

“Prior to the surge in buying of AIBs for cryptocurrency mining, AIB prices were flat to declining slightly which is a trend that will continue at least until new families of cards are introduced.”

Manufacturer share prices

The fall in the average selling prices for AIBs has had little impact on the share prices of their manufacturers, however.

Last month OpenLedger reported that AMD’s stock price had risen 82%, thanks in part to the rising numbers of their processing units being sold to cryptocurrency miners.

AMD’s share price hit a peak of $17.34 on 18 June and has since eased to $16.27. Nvidia’s shares have reacted a little worse: having peaked at $269.20 on 14 June they now stand at $247.53.

Post written by Chris Wheal
Chris Wheal is editor of OpenLedger's news and features service. An award-wining business journalists himself, he runs a team of freelance journalists from across the UK and north America.

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