Can GPU Mining Make a Comeback?


The incredible and unprecedented rise of cryptocurrencies has made an impact that vastly transcends just the exchange price of the digital currency. Sure, the emergence of a commodity that rose in value by thousands of percent is noteworthy in itself, but digital currencies have created a legacy that is so much more valuable than that.

A whole slew of ancillary products from unicorn-grade crypto exchanges like Coinbase to diversified investment products like the Bitcoin futures contracts offered at CME, CBOE, and Goldman Sachs. In addition, hundreds of crypto-focused hedge funds have emerged, and, as The Wall Street Journal candidly put it, “counting its returns in tens of thousands of percentage points hardly hurt their popularity.” Of course, the broad implementation of blockchain technology, the decentralized ledger that powers digital currencies, is perhaps even more valuable than the coins themselves.

Cryptocurrencies have altered the landscape of the financial industry, but they’ve had a profound impact on the tech scene as well. For instance, many cryptocurrencies are minted through mining, the GPU intensive process of verifying transactions and committing them to the currency’s decentralized ledger. As crypto prices rose precipitously last year, people turned to mining to acquire a more significant stake in their currency of choice. As a result, cryptocurrencies quickly increased the demand for the computing power required to mine cryptocurrency.

Crypto Clamors for GPU

Typically featured in powerful gaming computers, GPU chips became an in-demand commodity for the crypto revolution. For instance, RBC Capital’s Mitch Steves calculated that last June, “$100 million worth of GPU processors were added to the networks that mine Ethereum in just 11 days.” Many cryptocurrencies utilize a Proof of Work (PoW) consensus model that awards the monetary prize to the first computer that solved its cryptographic puzzle. More powerful computers meant more opportunities to earn cryptocurrency.

The demand for GPU cards grew so significantly that many companies simply ran out of stock.

As the Journal reports, “people mining ether and other cryptocurrencies have hunted graphics cards nearly to retailing extinction.”

For a while, these purchases paid off. Miners were handsomely rewarded with cryptocurrencies that were rapidly escalating in value. However, crypto markets have become more complicated this year. After a rapid price reduction, crypto markets have been treading water for months, and increased competition makes mining less profitable. Morgan Stanley estimates that Bitcoin must be worth at least $8,600 to make mining profitable. Its value has been well short of that measure, so the incentive for mining has been effectively nullified.

In a recent feature by Business Insider, Antonio Villas-Boas, a crypto mining enthusiast, demurred, “The moment mining becomes more expensive than buying the cryptocurrency, I’ll stop.” Many people have echoed this sentiment.

However, miners have accrued expensive GPU equipment that is now sitting dormant. Fortunately, there are new opportunities for those with GPU capabilities to profit from their computers.

Post-Crypto Mining Use Cases

GPUs are a powerful computing component, and they have numerous use cases outside of crypto mining. More specifically, GPU capability is an in-demand commodity that has substantial value on the open market. For graphic designers, photographers, and videographers, GPU capability is a critical component of their workflow.

Of course, GPU can be an expensive commodity, a reality that crypto miners are well acquainted with. Therefore, Leonardo Render has implemented blockchain technology to create a decentralized marketplace for GPU intensive rendering services. Using their platform, users can rent their now unused GPU capabilities to those who need it. Their platform combines the availability of cloud computing and the marketplace infrastructure of the blockchain to create a business model that is both affordable for users and lucrative for GPU owners.

Transactions on Leonardo Render’s platform are facilitated by their native LEOS token. In this way, Leonardo Render users are effectively mining for cryptocurrency by conducting rendering services rather than mining and confirming transactions blocks.

Graphics rendering is an important and in-demand task, so, for Leonardo Render, there is an element of serendipity to the decline of crypto mining. Moreover, it’s illustrative of the fact that all the GPU power accrued by crypto miners can be repurposed to provide new and better services that can be as lucrative as crypto mining.

Other platforms like Otoy are working on producing services similar to Leonardo Render. However, their services are more broadly applied to the media landscape where professional photographers and videographers can employ their GPU capabilities to create high-quality products in the cloud.

In addition, Vectordash, utilizes a similar model that enables users with unused GPU capability to rent their capacity to a cloud computing service that allows AI researchers to quickly acquire powerful computing capabilities. Members of Y Combinator, a funding collective for blockchain startups, expects that Vectordash users can earn as much as 2x the revenue of a crypto miner.

Meanwhile, Golem, a beta platform for crowd sharing GPU capacity, is focused on both graphics rendering and AI machine learning. Although the platform is still in the early stages of development, it reflects a growing movement toward a growing movement to capitalize on the computing power of GPU.

Cryptocurrencies aren’t going away any time soon, but the way we approach them certainly is. Even so, change can be useful, and it can be lucrative. In the case of crypto, this is especially true if you have GPU to spare.

 



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