At one time, it wওas profitable to mine Bitcoin and other cryptocurrencies using graphics processing units (GPUs). GPUs were a vital componenꦐt for mining computers to efficiently solve hashing algorithms, which led to a large spike in price and supply shortage for cards capable of mining cryptocurrency.

Here's a synopsis of the period when cryptocurrency mining generated huge profits for miners and GPU makers and created a shortage of GPUs. Also present is a brief discussion on what the future might hold for blockchain and GPUs.

Blockchain and GPU History

The cryptocurrency boom, which began around 2016, attrac♛ted considerable interest from entrepreneurs, existing businesses, 🌟and investors. Mining became an incredibly profitable endeavor, making it more appealing to individuals with computer idle time that could be put to use.

As more people joined the networks, mining difficulty levels increased due to how the blockchains of the most popular cryptocurrencies were programmed at the time. The computer processing units (CPUs), previously adequate for mining, fell behind in processing power as the race (and the pace) to discover crypt🔯ographic solutions incre🍌ased.

Cryptocurrency market values began to rise very quickly, attracting even more users, and home computer mining fell ou๊t of fashion as people designed mining rigs with more hashing power using multiple GPUs. Miners turned to computers dedicated only to cryptocurrency mining, which sometimes had more than eight graphics cards working in tandem to solve cryptographic hashes.

Causes of the GPU Shortage

This increasing need for bigger and faster mining computers created a serious problem in the GPU and computer components markets. In 2016, gamers and desi🐻gners began to notice a shortage of ♍GPUs available on the usual retailer sites. By the middle of 2017, there was a shortage of GPUs on the market as miners had been buying GPUs in bulk faster than they could be produced.

Prices skyrocketed for even lower-tier graphics cards, and many stores and retailers even had to establish measures to prevent s🎐ingle users from buying out their supply. For example, eVGA, at the time a popular GPU manufacturer, implemented a waiting list on its shopping page. NewEgg, an online retailer popular with computer builders, implemented a similar mea✱sure.

Future of Blockchain and GPUs

Outside of mining, blockchain and GPUs represented an ideal coupling. The former's distributed networks offer users a way to disperse computing power, leveraging the sum of its users to create "virtual supercomputers" that rely on the collective power of the network. Moreover, there remains an increasing demand for computing-as-a-service, evidenced by the growing popularity of cloud computing and the GPU-as-a-service market.

Several tech giants already offer these services, though they remain fully centralized and thus somewhat inefficient. Google Cloud offers GPU services, as does Amazon Web Services, and even Nvidia has started delivering solutions.

Other companies are creating platforms that use blockchain to harness distributed GPU computing power. For example, the Render Network uses the Solana blockchain, network, and proprietary cloud rendering software to match computational requests with GPU rendering power.

Clore.AI allows users to host a GPU and rent it to others who need more power for AI applications, mining, or rendering. Neura is a blockchain created for AI purposes that provides a network of GPU hosts. The company's website claims it can allow AI builders to " launch and scale AI with flexible, affordable, on-demand compute."

AI is overtaking (and being combined with) bloc🃏kchain and cryptocurrency in much of the tech industry. GPUs are likely to become much more in demand yet again for use in blockchain projects if ideas like Neura attract the interes꧙t of businesses, developers, and investors because they can handle computational tasks much faster than CPUs.

The Bottom Line

While blockchains once allowed the GPU industry to collectively r🍌evolutionize its sales model, as of October 2024, it was no longer profitable to use them for cryptocurrency mining. However, other GPU blockchain uses are emerging. Although these uses are not yet as profitable as cryptocurrency mining, blockchains can still use distributed GPU computing power to conduct many tasks quicker and more efficiently than relying on single GPUs, computers, or small networks.