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How are Digital Coin Miners performing?

How are Digital Coin Miners performing?

Given the sharp drop in prices of every digital coin in the current year, there are already doubts about the manufacturers of NAND flash memory chip making enough money. Surely, the current year will not be the same for the companies like AMD or Intel or NVIDIA as they gained immensely from the cryptocurrency market last year. It is quite unlikely that there would be short of memory chips for the miners. Therefore, the ambiguity in the sector could likely drive down the profits of those engaged in making graphics cards or mining activities.

Ethereum Mining

According to a report in pcgamer.com, there was a report about tweaking a GeForce GTX 1070 graphics card for more efficient mining of Ethereum. That suggested a profit of approximately $6 a day if the device was tuned properly. This would translate into $185 a month, which excluded electricity charges. If the price stayed at the same point throughout the year, then the owner of a GeForce GTX 1070 could profit $2,200 a year. That meant it should run without a stop. This was a situation on June 14 last year.

However, things have changed a lot after one year. The same set up is providing a profit yield of merely $0.56 a day. It was based on 27 MH/s hash rate without any changes in costs and power consumption. The miner should also perform 24×7 to make some extra cash. That clearly suggested that it has not been an easy thing for a miner to make a profit compared to last year.

The sharp drop in mining profit has got more to do with the volatility in the prices of digital currencies. The current year has already seen a big swing though bitcoin and Ethereum prices spiked after the United States’ SEC clarified that these two were not securities. That meant that these two cryptocurrencies were not under the purview of the securities regulator.

The SEC’s corporate finance director, William Hinman, said, “Putting aside the fundraising that accompanied the creation of Ether, based on my understanding of the present state of Ether, the Ethereum network and its decentralized structure, current offers and sales of Ether are not securities transactions.” His statement also boosted the digital current market cap to $291 billion from $271 billion within a period of 24 hours.

Graphic Cards Price Drop

In a related development, GeForce GTX 1070’s average price plunged about 38.9 percent to approximately $550 recently. The same device was available for about $900 only a couple of months back. This is not the bottom of it, and the bargaining power of a buyer could lead to a discount of even 50 percent compared to the peak levels.

AMD, NVIDIA, and Intel could make revenue of $776 million from the booming cryptocurrency business. However, these companies will not be able to reap the same thing, and the weakness in the sector could affect their sales number. The drop in prices meant that gamers would stand to gain. The second quarter, which ends in June, should provide some light about the demand and supply side.

About the author

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Brian Crain

Brian is a contributor here at Orbit Crypto. Brian was previously in charge of Business Development at the enterprise blockchain company Monax. He has degrees in economics, philosophy and cognitive science from The University of Chicago, London School of Economics and University College London.

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