Department of graphics cards of the store Central Computers are empty. Thursday, 25 January 2018, San Francisco, CA. Crypto currency miners bought all the high-performance graphics processors, which only could find, provoking a supply shortage and rising prices.
In a computer store in downtown San Francisco, the stand with five shelves, generally filled with graphics cards — popular devices to speed your PC — empty. It is unusual, but a clear sign that the craze for cryptocurrencies has seeped into the real world with speculators, the load of electric network in the pursuit of digital money.
“We need as many as we can find”, said Donnie Williams, a 36-year-old resident of Novato. He and his business partner David Miller, 47, of Pleasanton, paid $ 1000 for a single graphics card ex-last week in stock at the store Central Computers near the Moscone Center. The map they needed in addition to the five already available in their processing plant located in the house of the Miller.
People who help create (or generate) bitcoins and other cryptocurrencies, pounced on the processors after the currency rose sharply in price. Whenever someone buys and sells digital coins, the transaction is confirmed through a series of complex mathematical calculations. Those who makes the necessary calculations, earns a little of this currency for themselves. High-performance chips in graphics cards cope with them faster, which increases the profit of miners.
Mining also load existing energy system: the energy Institute, part of the business school and Walter Haas at the University of California, Berkeley, cites studies showing that the production of bitcoins worldwide per year consumed more energy than is necessary to ensure Bulgaria.
College students have free electricity in the dorms, trying to make a fortune. Recently Stanford University strictly warned students against using smokeless capacity of the campus or University computers for the mining of cryptocurrencies, reminding them that “the resources of Stanford University should not be used for personal financial gain.”
The rapidly growing demand for graphics processors is good news for such companies-manufacturers, including Advanced Micro Devices and Nvidia. But the lack of graphics accelerators and rising prices angered the other users – for example, enthusiasts video games, which graphics card is needed in order to keep up with new demanding graphical properties of the system of the video game “flew” on their computers.
Dan Sherman of St. Louis said its plans to build a new gaming computer, which he needs to work as a video game commentator and streamer for eSports organizations.
“For me it was a big shock when I saw these price increases, wrote in the email the 32-year-old Sherman. – I did not expect. I was very upset that I have to wait to implement his plan, and even to abandon the idea due to the fact that I can not wait for the needed device.»
The video game news site Kotaku accused the miners that they were the cause of the “Great shortage of graphics cards 2018.”
“Gamers are annoyed with the situation, says Ian Craig (Craig Yeung), the General Manager of the network of Central Computers, consisting of six shops based in Santa Clara. He even introduced in their stores restriction no more than four cards to one buyer, trying to save at least something for regular customers and commercial companies or gamers.
Design and architectural companies, which are using increasingly sophisticated software for applications of 3-D and virtual reality in computer aided design, have become hostages of the situation due to lack of graphics accelerators. Developers of video games and special effects for movies also rely in their work on the graphics processors inside high-performance graphics terminals.
But Ian told us that he receives emails from cryptocurrency miners from all over the world trying to buy as many video cards even with shipping from another continent.
Recent increases in the price for money – the price of bitcoin, in January 2017 amounting to $ 1,000 by the end of the year increased to $ 20,000 – made the atmosphere of the gold rush for small private miners like Williams and Miller, who spent last month about $ 12,000 for the equipment to earn on cryptocurrency fever.
Miners, as a rule, combine multiple cards together to work as one specialized system with motherboard, cooling system, power supply, monitor, and software. Mining farm will work all day and all night, processing complex transactions, which together make up the community-supported settlement system for transactions in Bitcoin, Ethereum, Ripple and other emerging currencies.
This equipment connects to a complex online ecosystem that provides the authenticity of a decentralized cryptocurrency transactions. The miners play a crucial role in the confirmation of transactions. For their efforts they get rewarded in crypto currency – unless their computers are fast enough to compete with other miners.
“For me it’s like investing in stocks and gambling at the same time, Miller says. – It is very exciting. Have you ever betting on horses? You cheer for your horse. If she comes first, wins. But if not, then…»
And here are the most popular graphics cards on processors from Advanced Micro Devices and Nvidia has become difficult to find in stores, which led to higher prices. “For example, Miller and Williams bought the Nvidia GeForce GTX 1080, which cost about 600 dollars”, – said the Manager of the store Central Computers candy Kwon.
Due to hurricane demand, Central Computers, restricted purchases four cards in one hand. Nvidia itself when ordering online has set a limit of two cards in one hand. Both Nvidia and AMD, declined to comment, citing SEC rules requiring a “period of silence” before the release of quarterly earnings reports.
“The prices in online stores for cards of higher price range AMD and Nvidia over the past two months has almost doubled, says Philip Carmichael (Phillip Carmichael), the founder of the company PCPartPicker.com located in Austin, Texas, and engaged in the tracking of prices for components for the customers, collecting the computers themselves. Our customers are definitely not happy with the situation, but now there is little to do except to wait»
Eugene Chung (Eugene Chung), General Director of San Francisco’s Penrose Studios, said that his startup uses graphics to create animated stories in a virtual reality. He does not consider a shortage of cards as a phenomenon with a direct impact on his business, as capital expenditure can be distributed in time. But he’s wondering whether the rising cost of video cards to affect its business otherwise. For working VR headsets to consumers requires a PC with a powerful graphics card. If the video card will rise in price, it could slow the growth in the market of virtual reality devices.
“My main concern is consumers,” says Chang.
“However, it is difficult to predict what will happen in the future, because the cryptocurrency market is very fleeting, says Gregory La Blanc (Gregory La Blanc), a teacher of the business school of HAAS at the University of California, Berkeley. Small miners, such as Miller and Williams have to compete with large-scale mining industries in China, Russia and Iceland, where electricity is cheaper, and the cold climate does not allow the chips to overheat”. Despite stiff competition, the recent surge in bitcoin prices, which in mid-December reached 19 783 dollars before to drop sharply, the market has attracted a lot of people.
“In many ways, it’s like Gold rush in California 1840-ies, when it was possible to just show up with a pick and a pan for washing the gold, and make money in the first couple of years, there were no major mining companies with hydraulics, heavy machinery, steam engines and brought a quick regular guys out of business,” says La Form.
Such prospects are not afraid of family of Mohammed, a 25 year old young man from riverside, looked into Central Computers the next day after Miller and Williams. Only the GTX 1080, which the seller put in a vacant Department of graphics cards recently, was worth$ 50 more.
Born Mohammed looks at the latest high-performance graphics card in the store Central Computers.
He said he scoured the computer shops in search of these elusive cards: “I was in Fry’s, Best Buy, everywhere and anywhere they are not.” Mohammed built a system consisting of six cards, bought them last month when they were worth $ 670 each.
“When I watched the price of bitcoin soared from 1000 to 20 000 dollars, I said to myself that I don’t want to miss it, do not want, then bitterly regret the fact that I did not do what you need, when you need it, he said. And if you know that you can get an additional thousand dollars a month, then why not, right?»
In the end he still bought the only available map. “One will not be confused. These need at least six, he said. I don’t know who may need one card – is that just for games”.