Computers mine cryptocurrencies with substantial processing power. They have a GPU (Graphics Processing Unit) instead of a CPU. The graphics card is the main component of a GPU.
The cost of GPUs has plummeted in the past few months due to the cryptocurrency crash. The prices first went down in 2020 due to the pandemic. The supply chains, shipping and manufacturing costs were all deducted due to the virus outbreak.
Graphix cards were mainly used for entertainment purposes, primarily by teenagers. After the cryptocurrency’s inception, everyone wanted to get their hands on a GPU. There was a supply shortage, and many listed second-hand GPUs for more than double the price.
After the crypto recession, no one is trying to buy a new machine. Nvidia, a leading company in the graphic card market, has said that there is no change in the retail price of GPUs.
The miner’s interests have shifted. They do not see any benefit in buying expensive hardware for their GPUs for many reasons, one being Ethereum’s shift to “Proof of Stake” technology. Ethereum will now require less mining power and hence generate even less profit.
— Hardware Unboxed (@HardwareUnboxed) March 19, 2022
Mining revenue falling has upset buyers
The mining industry’s revenue has currently fallen by 79.6% after reaching an all-time high of $74.4 million on October 25, 2021.
The second-hand GPU market is now flooded with used items and still looks bad for sellers but suitable for buyers.
The experts believe that retail, as well as second-hand prices, will keep on falling, which is creating a ripple effect and contributing more to the price drop.