There Are Big Companies That Are Bleeding Money Because Bitcoin Keeps On Growing

Jay Crypto

Blogger

Bitcoin hit $8,000 this week, a big step forward for the world’s most used cryptocurrency. But this also means that the digital currency has been through a lot of changes, especially this year, and some are beginning to lose, not to gain profit, informs Bloomberg.

Of course, miners are seeing El Dorado in front of their eyes, yet there are companies that were meant to benefit without having to touch the stuff, but are losing in the long run. The days of a global network with mining Bitcoin from home or the coffee shop are most likely over, outsmarted by specialist firms with the resources to make their own powerful mining kit.

Graphics card companies are having a great time

Advanced Micro Devices, Inc. and NVIDIA Corp. are just two of the companies that saw the opportunity, but are now left standing on the road. Their graphics cards have been used to do the power-sucking computations needed to confirm transactions, overtaking their peers in recent years. However, change has deeply affected them, unable to react to the latest Bitcoin highs.

Nowadays, at least when it comes to Bitcoin, it seems that an equipment supplier could only make profit if it’s there for the whole deal – make the mining gear, use it yourself and sell it to others, and trade the coins too. The profit it just not worth the trouble, especially when you’re a $100 billion-plus listed company.

But what about ETH?

Ethereum is somehow a different story. Its algorithm works better for miners wielding the kind of graphics cards, called GPUs, sold by the listed chipmakers than for those with specialized chipsets. Yet, the economics of Ethereum mining are getting harder, so probably it will have the same fate as Bitcoin.

For chipmakers, on the other side, this isn’t good news. Morgan Stanley analysts estimate that AMD’s GPU revenue will fall to $1.2 billion next year from an estimated $1.5 billion in 2017.

Still, there is hope for them, with the new Bitcoin spin-off, Bitcoin Gold, an algorithm designed for all folks that are into mining. But with Bitcoin growing so fast, who would want a change, except for those who are currently losing?