The downfall of the crypto market has brought them to their lowest market cap of the last 12 months. This had an adverse effect on the companies that manufacture mining hardware such as chips and graphics processing units (GPUs). Previously, using a very efficient GPU hardware was economical for the miners, but things have turned out differently due to the year-long bear trend in the crypto market.
This hardware may be efficient for mining but they are very expensive and since the fall of the crypto market tokens are not providing as much profit as to even make up for the hardware’s price. This is evident, as the price of Ethereum token has fallen to $108 while even the break-even point is at $175. This has harmed GPU manufacturers especially AMD and Nvidia.
Most companies that manufacture these mining units offer a 24-month warranty that has created a demand for second-hand GPUs that is causing an even greater short-term storage issue. Furthermore, many new companies have started to manufacture chips while some like Bitmain are claiming that their product is superior to others. This may be true considering that Bitmain’s Ethereum focused chip may be the only product that is profitable at this time.
These companies are very careful towards cryptocurrencies, but it isn’t as bad as it sounds as the firms’ policies have not changed. Moreover, the products these companies are making can be extremely useful to crypto miners as this would allow increasing the efficiency of the system while making mining easier than it had ever been.