Crypto-Currency ‘Mining’ Boosts GPU Demand
The booming GPU market propelled by new implementations ranging from "GPU clouds" for deep learning to HPC applications is getting an additional lift from growing demand for "add-in" graphics boards used in servers and, more recently, "mining" Ethereum virtual currency.
Among other things, Ethereum is designed to make it easier to create blockchain applications. Mining, which involves participating in distributed crypto-currency networks, requires much processing power. That has proven to be a boon for the GPU market, especially for key vendors such as Advanced Micro Devices (AMD) and Nvidia.
According to Jon Peddie Research, so-called Ethereum mining farms helped drive demand for graphics boards a whopping 30.9 percent sequentially in the second quarter. On an annual basis the graphics board market jumped 34.9 percent, the market tracker reported.
Soaring GPU demand also shifted quarterly market share, with AMD gaining nearly two percentage points (29.4 percent) from industry leader Nvidia (70.6 percent). Peddie noted that AMD (NASDAQ: AMD) and Nvidia (NASDAQ: NVDA) are thus far the only GPU suppliers of add-in boards, although a partner network of equipment manufacturers is flourishing as applications such as Ethereum mining gain traction.
"The big difference is the impact crypto-currency mining (especially Ethereum) is having on the market," Peddie explained in a research note.
"People are sending Bitcoins to each other over the Bitcoin network all the time, but unless someone keeps a record of all these transactions, no one would be able to keep track of who had paid what," the researcher added.
"The Bitcoin network deals with this by collecting all of the transactions made during a set period into a list, called a block. It’s the miners’ job to confirm those transactions, and write them into a general ledger. They are paid for this work in like currency."
Other observers noted that AMD's second quarter gains in the GPU market are significant since it did not release its high-end Vega GPUs until earlier this month.
Meanwhile, growing demand for Ethereum crypto-currency that began to take off earlier this year has created GPU shortages. Hence, AMD has benefitted from strong demand and the resulting price spikes that, according to one report, jumped to more than $300 from about $60 since April.
Quarterly GPU add-in board shipments totaled $3.6 billion, Jon Peddie Research estimated. "Ethereum mining is the game changer this quarter."
AMD and Nvidia are meanwhile betting the crypto-currency mining craze continues and that miners will be buying more GPUs to boost performance. Both chipmakers unveiled plans earlier this summer to release GPUs tailored to the growing Ethereum mining market.
Mining is seen as a key opening for AMD in the GPU market where Nvidia dominates for emerging applications such as AI and deep learning.