China reports GPU price drops to all-time low after Ethereum merge

Ethereum’s successful upgrade to Proof of Stake consensus is receiving further backlash from the market. Therefore, the Ethereum upgrade should only generate positive feedback, but if there are advantages, there should be disadvantages.

One of the ensuing challenges that the industry has faced since the Ethereum upgrade has been the drop in GPU prices. GPUs have increased in crypto mining over the years as they have proven to be highly effective.

GPU companies have been earning huge profits due to the increased demand from ETH miners. However, that is no longer the case, as the price of GPUs has fallen dramatically over the past three months. Moreover, the prices of the GPUs have decreased even more after the upgrade.

Is Ethereum consolidation a major cause of GPU price crash?

The South China Morning Post (SCMP) reported that GPU prices in China fell to a record low due to the Ethereum consolidation. ETH mining is down. So miners’ demand for the GPU has decreased. Miners’ demands for more expensive cards like the GeForce RTX 3080 and RTX 3090 are running low and causing them to drop in price to drive down factory prices.

Also, due to the mining ban in China and the COVID shutdown, the demand for costly GPUs has fallen and exacerbated during the bear market. A trader in Shanghai, Peng, told SCMP that the RTX 3080 has fallen more than 37% in the past three months.

According to Peng, the price of the RTX 3080 increased from 8,000 yuan ($1,140) to less than 5,000 yuan (712%). Peng attributed the low price of GPUs to the poor state of the crypto market.

Ethereum mining has been one of the biggest contributors to the high demand for GPUs in the past years. Traders have noticed a drop in GPU prices as the Ethereum merger approaches.

SCMP reported that retailers at “Buy Now,” a large electronics market in Shanghai, are facing low demand for the GPU.

Retailers slash GPU prices

Chinese retailers slashed factory-suggested GPU prices by more than 33% in just a few weeks to sell their equipment. The reason for this is the bear market for cryptocurrency and the GPU patch market.

According to Baidu data, traders are losing the selling price compared to the factory cost of GPUs. Analysts estimated that the average price drop for GPUs per week is around 10%.

Some reports suggest that NVIDIA, a major GPU manufacturer, is lowering the price of the GPU for motherboard partners. This report is still unconfirmed, but is likely to cause further declines in the coming weeks.

Although the crash in GPU prices may negatively affect many companies, others believe it marks the end of two years of nightmare. Previously, many GPU retailers were raising prices as high as possible due to the high demand from miners.

The crash in GPU prices could be beneficial to AI programmers, gamers, and other users because crypto miners have caused an unnecessary increase in GPU prices.

Featured Image From Pixabay, Charts From Tradingview

from San Jose News Bulletin https://sjnewsbulletin.com/china-reports-gpu-price-drops-to-all-time-low-after-ethereum-merge/