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Why do people on this forum say that mining only had a minor impact on GPUs?

Rym
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This might be in the wrong subforum, sorry if it is.

 

So I was reading around the forums like a normal person, and I kept seeing people claiming how mining only had a very minor or insignificant impact on GPU availability and prices for the past 2 years.

 

However, this contradicts every YouTuber I saw, and this contradiction only occurs on these forums specifically.

 

Is it not true that Nvidia and AIBs scored record profits by selling GPUs these past 2 years? Except they were never in stock?

 

Is it not true that Nvidia tried to cancel or lower their order at TSMC following the mining crash?

 

Is it not true that Nvidia released the 3090 ti with exceptional memory performance for mining?

 

Is it not true that Nvidia is delaying Ada Lovelace as a result of mining collapse aftereffects?

 

Is it not true that AIBs are sitting on millions of RTX 30 series GPUs that they can't sell anymore because they planned on selling it to miners?

 

Is it not true that AIBs have begun laying off (firing) employees to save money because they can't sell overpriced GPUs?

 

Is it not true that the delay of Ada happened because AIBs can't sell RTX 30 GPUs because mining is over, they stocked up for it and now these GPUs are overpriced and no one wants them?

 

Is it not true that the used market is chocking on the mountains of GPUs it's flooded with?

 

Please tell me what minor effect means, explain it like I'm 5 years old and an idiot on top, I'd like to understand why this minor effect has caused AIBs to demand delays to the next generation of GPUs, why this minor effect caused Nvidia to try to cancel wafers from TSMC and why this minor effect brought in massive profits for Nvidia and AIBs? 

 

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I don't know if mining had a big impact or not but I know the picture is not that simple. 

 

The availability was largely affected by silicon shortage, meaning the manufacturers of substrates like TSMC could not meet the demand. Therefore AMD, NVIDIA, etc... could not produce enough to satisfy demand. 

 

Yes, miners took a lot from what was available but at the same time the availability was low for everyone so its not just miners fault entirely. 

 

AMD, NVIDIA, etc... bought a reserved a ton of chips way ahead to catch up with the demand but suddenly they were able to produce way more than necessary after availability normalised. At the same time crypto crashed so suddenly miners are not buying anything and people are waiting for next gen because they were already waiting too long to get a card so waiting a little longer won't hurt them. 

There's your overstock. 

 

Somebody correct me if I'm wrong but that's how I understand the situation. 

 

Just to add... during COVID almost everybody needed to buy a PC to work from home so that also greatly increased the demand. 

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People who suggested that miners didn't have much of an impact on the pricing/availability of GPUs were drinking the kool aid.

 

A lot of the pushback came from the fact that there was a lot of hostility towards individuals who were mining, when the costs of cards were affected by large mining operations.

 

Although, the negative impact on the environment and the new scam-heavy economic scene of NFTs and the like make for pretty shaky moral ground for any kind of mining to say the least.

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I'm pretty sure that mining explains 80%+ of the GPU "shortage" 

Manufacturers expected gaming demand to go from say 100 to 120, what happened is that new generation cards + Covid induced lockdowns made gaming demand go to 200, BUT mining demand was another +200, and mining farms directly bought boatloads of GPU to wholesalers, with nothing really left for gamers

The whole "silicon shortage" seems storytelling to me, why then wasn't there ANY shortage of CPU, RAM, SSD, and only GPUs ??? C'mon...

 

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Just now, PDifolco said:

The whole "silicon shortage" seems storytelling to me, why then wasn't there ANY shortage of CPU, RAM, SSD, and only GPUs ??? C'mon...

Well there were at first, the 5000 series CPUs from Ryzen in particular were a sore spot when it came to availability and pricing.

 

But the fact that GPU availability was lacking for a much longer period of time was testament to the fact that mining had a much more sustained impact on this market segment.

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15 minutes ago, WereCat said:

I don't know if mining had a big impact or not but I know the picture is not that simple. 

 

The availability was largely affected by silicon shortage, meaning the manufacturers of substrates like TSMC could not meet the demand. Therefore AMD, NVIDIA, etc... could not produce enough to satisfy demand. 

 

Yes, miners took a lot from what was available but at the same time the availability was low for everyone so its not just miners fault entirely. 

 

AMD, NVIDIA, etc... bought a reserved a ton of chips way ahead to catch up with the demand but suddenly they were able to produce way more than necessary after availability normalised. At the same time crypto crashed so suddenly miners are not buying anything and people are waiting for next gen because they were already waiting too long to get a card so waiting a little longer won't hurt them. 

There's your overstock. 

 

Somebody correct me if I'm wrong but that's how I understand the situation. 

 

Just to add... during COVID almost everybody needed to buy a PC to work from home so that also greatly increased the demand. 

I think the mining issue has had a great impact on the gpu market because they made selling the gpus at ridiculous prices viable. People could justify the insane prices if they were going to make their money back mining and it was seen as an investment. This incentivised scalpers which also screwed with the already limited supply. Then with crypto crash the problem is two fold with less demand for gpus and a flood of used gpus into the market. You have the perfect storm where there is just way more supply than demand causing issues. 

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14 minutes ago, Fasauceome said:

Well there were at first, the 5000 series CPUs from Ryzen in particular were a sore spot when it came to availability and pricing.

 

But the fact that GPU availability was lacking for a much longer period of time was testament to the fact that mining had a much more sustained impact on this market segment.

The 5000 series "shortage" was more the result of an unexpected success and didn't last that long, and prices didn't rise x3 neither !!

 

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Would you complain if NSA or some university orders a supercomputer with 10k video cards?  Or blame that university for the lack of video cards?

Would you complain next time Disney or whoever animation studio orders a few thousand video cards to render cartoons faster?

 

Using video cards for mining is a legitimate use, just like datacenter and workstation (for AI and rendering) cards are legitimate use... it's not just mining that caused the prices to go up.

There's also the other side ... now nvidia has a ton of video cards they have to hold until the 3rd generation series is sold so there should be big discounts coming up.

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1 minute ago, Rym said:

Is it not true that Nvidia and AIBs scored record profits by selling GPUs these past 2 years? Except they were never in stock?

Maybe they were never in stock because they sold all of the stock...? The demand was huge during the last 2 years. I'm not really sure what you're alluding to here but it seems like you're questioning how Nvidia was able to be profitable when their products were flying off the shelves immediately at higher than expected prices. The answer seems pretty self explanatory.

 

1 minute ago, Rym said:

Is it not true that Nvidia tried to cancel or lower their order at TSMC following the mining crash?

I believe Nvidia negotiated with TSMC to delay the order by one quarter, not cut the order. AMD also reportedly cut their orders from TSMC. Intel which was planning on outsourcing some wafer production to TSMC also delayed their order. Apple also revised their order with TSMC to cut their order despite not making any hardware that is used by cryptocurrency miners. The revised order from TSMC is likely in response to lower overall demand in the entire PC industry than what was previously expected so they are adjusting their orders to reflect their most recent predicted demands.

 

3 minutes ago, Rym said:

Is it not true that Nvidia released the 3090 ti with exceptional memory performance for mining?

Nvidia releases high end cards as halo products to ensure they are always on top of the performance charts as that wins mindshare among consumers. It's the "Nvidia makes the best performing GPUs so I should by an RTX 3060" logic consumers have.

Miners want the best performance per dollar and putting super fast memory on a GPU with a massive (and expensive) GPU die isn't necessarily helpful for that. From my limited understanding, If Nvidia were making mining-orientated cards they'd likely be better off using cheaper GPU dies along with fast memory, so you would more likely see something like a 3060 or 3070 class with better memory performance if they wanted to create a card targeting mining. 

 

7 minutes ago, Rym said:

Is it not true that AIBs are sitting on millions of RTX 30 series GPUs that they can't sell anymore because they planned on selling it to miners?

What is your source that Nvidia has millions of GPUs they're not selling?

There's little reason for them to sit on GPUs, especially now when next generation cards are not far from release. Once new generation cards are released typically demand for previous generation cards declines and having "millions" of last generation cards sitting in inventory is simply not good for business.

If Nvidia does have millions of GPUs sitting in inventory they would push that stock through AIB partners (likely providing rebates, discounts, or other incentives to the AIB partners to encourage them to take the excess stock) and you'd likely end up seeing discounts on graphics cards at retail... Which would be good for people looking to buy, right?

 

 

 

It seems like you've already decided that miners = bad and you are trying to find things to validate your opinion and you are correlating whatever you can to cryptocurrency mining to justify your beliefs. Cryptocurrency mining is an application for graphics cards and any application for a product will have an impact on the industry, but you can't blame everything on cryptocurrency mining alone while ignoring all the other factors at play.

It's also strange that all of your points are specifically targeting Nvidia. AMD was in exactly the same boat as Nvidia. It's not as if AMD GPUs were sitting on shelves with a discount sticker on them gathering dust next to empty Nvidia shelves while everybody was complaining about graphics card shortages.

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42 minutes ago, mariushm said:

Would you complain if NSA or some university orders a supercomputer with 10k video cards?  Or blame that university for the lack of video cards?

Would you complain next time Disney or whoever animation studio orders a few thousand video cards to render cartoons faster?

 

Using video cards for mining is a legitimate use, just like datacenter and workstation (for AI and rendering) cards are legitimate use... it's not just mining that caused the prices to go up.

There's also the other side ... now nvidia has a ton of video cards they have to hold until the 3rd generation series is sold so there should be big discounts coming up.

Honestly mining wouldn't be considered legitimate use for me as its built on a system with a horrible profit incentive where you basically use as much energy and resources you can get your hands on and it just terrible for the world in general. I honestly believe that the world would be a better place if cryptocurrency never existed tbh. 

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2 minutes ago, Brooksie359 said:

Honestly mining wouldn't be considered legitimate use for me as its built on a system with a horrible profit incentive where you basically use as much energy and resources you can get your hands on and it just terrible for the world in general. I honestly believe that the world would be a better place if cryptocurrency never existed tbh. 

A lot of people don't give a shit about cartoons and anime, and wouldn't rather the companies higher thousands of people to draw by hand each frame instead of using video cards to render the cartoons.

You only care about electricity consumption but don't properly account for the benefits of the technology.

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It's no coincidence that the crypto crash comes with cheaper and more plentiful gpu supplies.  It's no surprise to anyone really, saying otherwise is delusional. 

 

Cryptobros are still hodl as the ship burns and sinks, they will keep attempting to save the ship at any cost, trying to make the scams legitimate and saying whatever they can to improve the image of it all. 

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21 minutes ago, mariushm said:

A lot of people don't give a shit about cartoons and anime, and wouldn't rather the companies higher thousands of people to draw by hand each frame instead of using video cards to render the cartoons.

You only care about electricity consumption but don't properly account for the benefits of the technology.

The technology is fundamental flawed like I pointed out and many people have pointed that out about pow cryptocurrency mining including the creators of Ethereum so don't act like pow isn't. I wouldn't care if cryptocurrency actually took a certain amount of compute to just do something and as computers got faster and more efficient the energy usage goes down. Unfortunately that isn't how it works. 

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1 hour ago, PDifolco said:

The whole "silicon shortage" seems storytelling to me, why then wasn't there ANY shortage of CPU, RAM, SSD, and only GPUs ??? C'mon...

There are STILL ongoing shortages related to all manner of different electrical components from power supplies to fans and even capacitors and the like. Everything has been hammered by the shutdowns in China. If there "were no shortages" and "it was all fake" then please please please explain why cars are years behind in production, networking gear takes 30 to 52+ weeks to ship, and dozens of other industries face continued shortages and backlogs due to lack of supply?

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23 minutes ago, Spotty said:

Maybe they were never in stock because they sold all of the stock...? The demand was huge during the last 2 years. I'm not really sure what you're alluding to here but it seems like you're questioning how Nvidia was able to be profitable when their products were flying off the shelves immediately at higher than expected prices. The answer seems pretty self explanatory.

And yet you seem to have missed the point completely.  It's clear from the rest of the post he is well aware that it was sold out, but is heavily implying that it wasn't just sold out for things like smaller supplies because they were making record profits.  Also it's foolhardy saying at higher than expected prices, they have vendor contracts so when their vendors sell a $300 card for $600 it doesn't automatically mean they make extra money.  Their margins over the last 5 years have steadily increased by about 1 - 2% each year; and yet their revenue was up 53% from 2020 to 2021.

 

With his implication being that they are selling out, yet making record profits therefore it can't be the simple chip shortage excuse which many people use as the reason. [Not saying it's right to think it's just crypto, just that it's right that the chip shortage excuse doesn't make sense]. If it was truly a chip shortage and they were getting higher than expected prices then their gross margins would have increased to reflect that; but they didn't which could imply a lot of things

 

One of the things it could imply is that they were producing of the higher variant cards, knowing they get a higher revenue from it (but higher build costs)...but given that it was in a sellers market, it meant that they knew they could sell the same amount of expensive cards as they could mid-range cards.  Which then leads back to why is it a sellers market for GPU's.  My guess is more people at home, more people going into gaming and once the market gets scarce people focus on it and try getting it while they still can...mixed in with crypto as well.

 

Another thing it could imply is that they were selling even more GPU's, which completely eliminates the chip shortage theory

 

1 hour ago, Spotty said:

Cryptocurrency mining is an application for graphics cards and any application for a product will have an impact on the industry, but you can't blame everything on cryptocurrency mining alone while ignoring all the other factors at play.

It's also strange that all of your points are specifically targeting Nvidia. AMD was in exactly the same boat as Nvidia. It's not as if AMD GPUs were sitting on shelves with a discount sticker on them gathering dust next to empty Nvidia shelves while everybody was complaining about graphics card shortages.

While there are multiple factors into what lead us to this point, I do believe it's fair to say that Cryptocurrency has had a major effect on GPU pricing.  Nvidia and AMD GPU production have pretty much been tuned over the years for selling to the gaming market.  While there might be shortages here and there, it never was for prolonged periods of times...as things quickly stabilized in the frenzy buying to get the newest cards....but it was a fine balance of overproducing vs underproducing

 

With the introduction of mining that equation was flipped on it's head.  At the peak, it was hard to overproduce a card but very easy to under produce...which now puts an arms race essentially between people wanting to game vs miners.

 

In my circle of friends, I know of 2 people who mine...they currently have more GPU's than the any of my other friends.  One of the reasons as well, they use the money they made from crypto to fund purchasing cards at a higher price as they knew with the purchase of the card they could make back that money.

 

So while I don't think it's solely on crypto, I do think that it was still a significant driving factor...especially in regards to the price.  Actually a good example of it, when I purchased my 1070 in 2017, I remember crypto spiking and seeing the price of my video card rise to insane proportions [before it started settling again after the crash].  So there is a bunch of credence to blaming crypto.  Overall crypto doesn't have a minor impact on the market, which is what the OP was saying.

 

Other driving factors, a bit of the chip shortage, and I think an equal driving factor that people were now at home and were gaming more.

 

Mix the two together and you have a perfect storm

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2 hours ago, Rym said:

This might be in the wrong subforum, sorry if it is.

 

So I was reading around the forums like a normal person, and I kept seeing people claiming how mining only had a very minor or insignificant impact on GPU availability and prices for the past 2 years.

 

However, this contradicts every YouTuber I saw, and this contradiction only occurs on these forums specifically.

 

It's because:

a) many people including LTT staff and Moderators of this forum are invested in the group-think of "do whatever with your GPU, you own it, who cares" line of thinking

b) LTT staff are in Canada, specifically BC, which has cheap, green, energy, and nobody here was impacted on the energy side. Just everyone who tried to buy a GPU from Canada Computers, Memory Express or Newegg, could not get one.

 

So if you subscribe to A, then any time a thread pops up here about GPU-based mining, you will inevitably get people pushing the narrative that if you own the hardware, you can do whatever you want with it. damn the consequences. 

 

For the most part, the story is pretty stable on the forum, and with youtuber's covering the subject. There is just a disagreement on who is ultimately responsible for the GPU prices. If you are invested in the idea that miners caused the GPU prices to skyrocket, due to scalping, that's the data point you're going to stick with. Despite that being true, that's not the only factor. Both the pandemic and the sudden logistics backlog caused by everything being locked down, was also a factor. This also resulted in some production being scaled back or reallocated, when people were buying computers for home use during the lockdown.

 

In a more clearer mindset, no, miners were not the singular reason for the impact on GPU's, but they were the most contributory factor to being unable to buy a GPU at retail, due to a combination of scalping "of a hot product" and the stores themselves holding back inventory for their own builds. OEM's had no problems getting GPU's, but they were also marking the price up substantially more than the retail GPU-alone parts.

 

This left people in a predicament of:

a) Do I buy a lesser or no-GPU computer and wait until conditions improve?

b) Do I buy whatever I can find?

 

We're now in the upside down part of this story, where now GPU's that the stores were holding back for their own builds are being dumped because they don't want to be holding that inventory IF we get a repeat of this with the 40-series, or if a new GPU-mining crypto coin takes off. But just the same, there are a lot of regulations coming down the pipe on who can do crypto mining, and tax implications of crypto mining, so many "hobby" people are also getting out of it while the getting is good so they aren't sitting on assets they can't use.

 

So *shakes crystal ball*, it's likely that bringing up crypto stories here, will just get you a "oh, not this crap again" type of arguments, and not any good-faith debate. That story has been beaten to death.

 

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People on this forum say a lot of things.

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Prices changed but I could still buy them. The 10 series was out for over a year before the public mining boom. If it takes you that long to buy a card, you shouldnt be blaming others. Just cry to yourself and pay to play. 

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