If the situation is different from 2017 because of the Covid crisis, cryptomoney is nevertheless experiencing a huge leap that has an unfortunate consequence for us players, the huge difficulty to get a graphic card. And this is not going to go away. Faced with a rapidly devaluing economy and in a hurry to diversify their investments into safe havens, the world’s top 500 companies, including Tesla, may well enter the fray and cause prices to soar.
Why is everyone investing in Bitcoin and cryptomoney?
Simply put, we are in the middle of a very uncertain period with a post-Covid economic crisis looming. Part of the economy is being kept artificially alive through government borrowing, and it is the same situation that prevails in the United States or Europe. Except that by issuing a large amount of money, it devalues its value. If we go back 50 years ago the Mustang cost $2,368. By making money, it increases its mass and decreases its scarcity, which decreases its value, and therefore requires in time more dollars to shop for a Mustang in 2021.
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On the other hand, the indebtedness that will result from borrowing in the post-crisis period points to a further loss for traditional currencies. In times of crisis, it is customary for investors to bet on safe havens such as real estate, gold, art and rare materials and objects. Bitcoin was watched by all the big bosses of the world’s top 500 companies, but who was going to be the first to risk it? If he lost, it was a sure thing and a decision that will serve as an example in the economics books.
For his part, Elon Musk, like the other big bosses of the top 500, was being pressed by shareholders to diversify investments, to understand how to find new safe havens. Helped by his reputation as a go-getter, he was the first to open the door, but it quickly turned into a boulevard. Apple is also thinking about it, and if others follow, Bitcoin has mostly left to reach $100,000.
On the public side, exactly the same thing is happening, but for a long time now since it was the first to invest. Cryptomoney fluctuates, but it remains stronger and more valuable than the national currencies.
Elon Musk may have invested 1.5 billion, but this is only a drop in the ocean compared to the stock market value of 800 billion Tesla. Nevertheless, this is a very strong message. In the midst of the crisis, in service economies that are creating less and less technology and where a significant part of consumption depends on made in china, it is better to invest in safe havens, and Bitcoin may have become one of them.
And this is where the miners come in. Let’s recall the principle of mining. As there is no bank to check the accounts during a transaction between two parties in cryptomony, your graphic card, which excels in this type of calculation, is made available to the payment chain to carry out these checks, paying you a few cents in the process. The more graphics cards you have that undermine, the more dollars you collect, and as the value of Bitcoin keeps increasing, you are paid not in dollars but in Bitcoin. Furthermore, what is mined can then increase in value if you don’t touch it.
As in 2017, the boom in Bitcoin and now other crypto-currencies such as Euthereum is causing their value to rise. Faced with the Asiscs computers dedicated to mining, but whose demand far exceeds the supply, graphics cards are thus taken by storm.
Except that with a whole generation of gamers who had put aside the RTX 2000, preferring to wait for more interesting and better controlled RTX 3000, the demand has become unprecedented. However, mining is interesting in only a few countries in relation to the cost of electricity, including China. And since all the production plants are located in China, Chinese miners are able to shop for graphics cards right out of the factory.
Scalpers on the lookout
The scalper phenomenon is not new, but the arrival of bots allowing to buy a product a few tenths of a second after it is put online has become a real problem. All the more so as the big brands often do nothing to counter this phenomenon. Walmart certainly uses anti-bots tools, but this is not yet enough.
As a result, some of the rare material put on the market is immediately found on eBay, Amazon or Kijiji at twice its price. This phenomenon will unfortunately continue as long as the offer has not returned to a better level. Public bots and Discord exist to help players, but they don’t allow to buy quickly. They are still a good help to warn about the availability of a product, but it is often only a few seconds.
Add to this the component and shipping container shortage issues we talked about earlier, and everything is lined up so that a return to normal is not possible for several months. AMD, Nvidia, just like Sony are talking about June-July for a better availability after a shortage that will worsen due to the limited availability of containers. Even with more cards available, demand will remain extremely high. However, instead of seeing products run out in seconds, there is a greater chance that graphics cards will remain available from minutes to days.