, The GPU short for graphics, processing, unit. GPU is bring digital worlds to life.. In the last few years, theyve become v computer chip of choice among certain crypto miners. Theyre, also becoming increasingly more important and cutting edge fields like self driving cars and supercomputing., But like every other kind of computer chip and 2021 GPUs remain in short, supply.. The current state of the chip market in terms of gamer perception is utter Bedlam.. If you are interested in doing anything in PC gaming, that is anywhere near cutting edge youre, either trolling through as many eBay listings as possible lining up at retailers, the instant they might have. Availability for a new card or giving up. GPUs are specifically designed computer chips. That process complex calculations alongside a CPU or a central processing unit., All computers have CPUs more and more.. They also now have GPUs either to play games handle complex, visual software or to conduct parallel processing.. Now why did we make that shift because historically, computation used to be serial that lets say I give you a certain workload and you were able to divide that workload into smaller pieces. And a CPU would be able to go through each of those many workloads serially.. So as an example, if there is a picture – and I asked you to find the shape of an animal in the picture, I can bear it that picture into a grid. And I can go through those grid points one by one which is serial processing.
Or do you know what I can do is I can look at every grid point with its individual processor, all at the same time. Thats, parallel processing., The Covid 19 pandemic wreaked havoc on the world supply chains. Semiconductors quickly became very hard to find. When COVID 19. First emerged: strict lockdowns caused demand to plummet across entire industries., But when lockdowns lifted and vaccines rolled out, demand came back in a big way, helped of course, by generous government stimulus, programs. And since computer chips and semiconductors are now used in virtually everything supply dried up. As demand came, roaring back. Now for GPUs demand came from a few camps.. You had your PC gamers, your crypto miners and people who wanted to hoard graphic cards in order to sell them later. Gpus became super hard to find retail prices on the secondary market. They sold for several times their MSRP.. Now. The tough part is that you know in semies we are just going through this tough period of supply, shortages., So one way or another. I think we would have gotten this issue, whether even if and just crypto miners are exacerbating that problem. Somewhat. Historically GPUs were used to power, video game, graphics from the arcade rigs to the early home gaming consoles. And for the most part thats what they still do.. The GPU business as we know it, though got started in the 1990s. Computer games, were advancing quickly and they needed more processing.
Power. Companies, like 3d FX popped up to help. Pc gamers play the latest games without having to buy entirely new computers., And they did that by introducing video cards to help process increasingly complex 3d graphics. In 1999, Nvidia announced the GeForce 256, calling it the worlds first GPU that kicks off an arms race between Nvidia, Which ended up buying 3d FX and a Canadian company called ATI, which was bought by Advanced Micro Devices in 2006. For 5.4 billion. That arms race is still very much going on between Nvidia and AMD.. But yeah I mean like Nvidia and AMD. Are the two big retail brands for gamers such that, like they kind of divide themselves into these tribal identities around like which brand of chipmaker they support in video folks, LEED, Green and the AMD people are Team, Red. Yeah? They really want to hold on to this. This core loyal customer base, gamers. GPU makers like Nvidia and AMD, are known for making games. Look more and more amazing. Each year.. The companies hold flashy events to launch new graphics cards. With the latest ray tracing technologies.. They sell GPUs to data center clients as well.. In fact, Nvidia brought in about 2.4 billion last quarter from its data center business. A record number. Its gaming business, though brought in 3.1 billion during the same quarter, also record At 5 higher than the year before theres. Another group of retail consumers who want the same GPUs as gamers crypto miners.
, And if you go to a Best Buy, you cannot buy an ASIC., You cannot buy. You know programmable chip., So you can really buy a graphics processor and you know if you buy it and youre not using it for ethereum a lot of the time I mean you can use it for gaming. Also. The summary point is that right now, GPUs are offering that computation of flexibility and ease of purchasing that matches well with where etereum is in its lifecycle.. Covid also sparked a boom in gaming, with everyone stuck inside the supply chain crunch, seen across all sorts of other industries, hate computer chips, the hardest and video remains the leader and the GPU industry by a wide margin controlling about 83 of the discrete GPU market and The most recent quarter. AMD is market share rests in about 17, as of last quarter, Nvidia needed to do something to ensure that gamers had access to GPUs.. First in early 2021 introduced hash limiters to its latest line of graphics. Cards. crypto miners quickly figured out a way to beat them. Nvidia has essentially like just nuked its its own graphics cards, to try to weaken them in key ways to divide them between the chips that are meant for the gamers and the chips that are meant for The crypto miners. They are trying to keep this core block of super dedicated customers happy. Its just like the supply chain is so screwed. Up., Like none of this, has worked its way through the system yet to meet a demand from gamers for the latest graphics cards.
. The company also released whats called CMP chips, or chips specifically designed for crypto mining to help ensure that GPU supplies remain in stock for gamers sales. For that chip pale in comparison to gaming chips. And its most recent quarter and video said CMP chips brought in 266 million in sales, which is lower than the 400 million the company had predicted in May. Whats more in video CEO says, the chip shortage will persist Into 2022. Theyre kind of stuck in this very strange conundrum of having a product that they cannot keep on store shelves, but also having a reputation of game fans being furious about them not being taken care of.. The Ethereum blockchain is supposed to undergo a massive overhaul in 2022., Going from a proof of work protocol to proof of stake.. This has big implications for how ethereum the worlds second largest cryptocurrency gets mined. The worlds largest digital currency. Bitcoin has grown so large in recent years that hardware companies now make computer chips specifically designed to mine. Bitcoin. Theyre called ASIC chips, which stands for application. Specific integrated circuit., But where we are today, is that the ethereum still requires a lot of complex calculations.. But it is not at a point yet where you can design those ASICs right where the algorithms keep on changing.. So there is always that increasing complexity. And to handle that increasing complexity, you need something that can be programmed very quickly.. Proof of work requires machines to complete increasingly complex math equations to generate new coins.
. This requires more and more computing power and requires more and more energy. Its how Bitcoin gets mined and ether as well.. The ethereum community, though, plans to switch to a proof of stake model that requires users to put up their existing cache of ether as a way to verify transactions and create new coins. That would completely overhaul the way that ether gets mined today and it would cause demand for GPUs among ether miners to plummet.. The real interesting question to me is that if you are a miner and if you think that ethereum is indeed going to go to this proof of stake, why are you still bidding up the price of this card? Why you know 123 times above MSRP.? So maybe that market is implicitly trying to tell us that that dont be fixated in terms of Oh. This is Bitcoin theres ethereum, and this is this coin or that coin that people who are buying. This maybe think that the need for complexity in this market will never go away. So to them even paying up for this technology today. Its still worth it Nividias doing great at selling out this very expensive thing., But that doesnt mean that theyre going to own an Entire market, an entire number of users and theyre interested in things like cloud.. They like Microsoft, have a whole cloud system and Google and Ubisoft and many other companies even Sony. Have these online streaming services where they have their own server farms with their own giant graphics card slapped in You just log in, and you use the internets back and forth latency to play the games you want.
. So there could be a future in a few years where youre not hunting for a GPU or a console or a big box in your home. And you simply log in and pay per month and the idea of the millions and millions of people who would pay per month and give you that recurring revenue.