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Fortunes turning? Specialized GPUs and SSDs come to aid crypto miners

Manufacturers restrict mining of cryptocurrencies due to a shortage of GPU cards: Will this lead to the end of mining as we know it?
After an exceptional start to the year, the crypto market entered a bearish period in mid-May, causin

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Manufacturers restrict mining of cryptocurrencies due to a shortage of GPU cards: Will this lead to the end of mining as we know it?

After an exceptional start to the year, the crypto market entered a bearish period in mid-May, causing some to reevaluate their stance on some of the fundamentals surrounding the crypto industry.

The prolonged fall of Bitcoin (BTC) — by more than 50% — and the subsequent dip in mining difficulty by 16%, which are suspected to have been partially caused by news of China’s intention to take tough measures against crypto mining and trading, as well as Tesla’s decision to stop accepting Bitcoin as payment for its electric vehicles, have turned out to be a turning point that brought criticism of crypto to a new level.

Against this background, some commentators and crypto enthusiasts have started talking about the possible end of the mining era. Or is it just a new beginning and a way for the industry to reinvent itself and make use of new solutions to appease the ever-expanding number of stakeholders?

Hardware deficit and price growth

The first bell actually rang back in February this year, when buyers of GPU cards, whether they are miners or gamers, had begun talking about a severe shortage of available cards, which led to exorbitant price increases.

For example, in the United States, some models of cards have risen in price by 120%. It should be noted, however, that the lack of components that make up the video cards have played an important role in such a price hike. What’s more, the slowdown in global supply chains on the back of COVID-19 restrictions has only exacerbated the already dire situation.

Given the spread of hysteria surrounding the short supply of GPU cards, miners were looking for alternative ways of mining cryptocurrencies as new cryptocurrencies, such as Chia (XCH), appeared. Mining this cryptocurrency requires the use of a solid-state drive (SSD), which is used for storing user data on a personal computer and is several times cheaper than GPU cards.

Chia uses free space on the device’s storage, and the more free gigabytes there are, the faster this cryptocurrency will be mined. In addition, Bram Cohen, creator of Chia Network, argued that his cryptocurrency is environmentally friendly compared to others because hard drives consume significantly less power than GPU cards, which means less harm to the environment. Of course, critics were quick to point out a key shortcoming of such a strategy, arguing that the lifespan of this equipment gets reduced to just 80–160 days, which means it must be constantly disposed of for something new.

Despite an alternative to the GPU cards, the emergence of Chia has also inevitably led to a shortage of storage devices and an increase in their prices. In China, back in April, consumers began to buy hard disc drives with a capacity of 4–18 terabytes, while SSDs were also in hot demand. In Hong Kong, the excitement instantly provoked a rise in prices for these components; depending on the model, the cost increased by $25–$75.

Fighting miners

In the wake of price increases, GPU card manufacturers began to actively fend off crypto miners back in February. Spearheading the assault, Nvidia tried to prevent mining by releasing a special driver 470.05 for its RTX 3060 cards, which are widely used for mining Ether (ETH). However, the block did not work in most cases, as miners bypassed it using cheap plugs for HDMI ports that mimic the operation of a monitor.

The unsuccessful attempt to limit the performance of GPU cards forced Nvidia to try a hardware block. At the end of May, the company announced a line of GPU cards called GeForce RTX 30 Lite Hash Rate. The GeForce RTX 30 LHR series includes video cards of the 3060, 3060 Ti, 3070 and 3080 series.

Protection against mining on these cards is implemented at the hardware level: When Ether is mined, the performance drops by half, and the overall mining efficiency decreases by more than 50%. The start of sales was scheduled for late May to early June, but the company has not yet released this product.

Nvidia’s partners have also joined the initiative by releasing GeForce RTX 30 LHR cards under their own brands, and Zotac was among the first. These cards are distinguished with a new marking so that buyers can differentiate the cards when buying one. Anti-mining cards have letters “GE” or “G” in the name, for example, Zotac RTX 3060-12GD6 Destroyer GE Pro.

Moreover, at the end of May, PC manufacturer Asus registered the v2 series GPU card with the Eurasian Economic Commission. Most likely, this is how the company labels the LHR models, which have hardware and software protection against Ether mining.

It is noteworthy that AMD, the only big competitor to Nvidia in the GPU cards market, has not yet reacted in any way to the attempts of its competitors to return the prices of gaming cards to their previous values. The company has announced no plans to release special anti-mining modifications of its accelerators. Meanwhile, the company said that it would not limit the computing power for mining cryptocurrency so that users can determine what to use the computing power of the GPU for.

Double game

Having deprived crypto miners of using gaming cards, Nvidia simultaneously offered miners an alternative in the form of a series of CMP HX accelerators. These products are focused specifically on mining, which is expressed in the presence of a special crypto mining processor (CMP) and the complete absence of external interfaces. In other words, it’s simply impossible to connect a monitor to them — thus, it can’t be used for gaming.

Asus CMP 40HX will be able to provide mining efficiency of up to 43.77 megahashes per second, while the official number announced by Nvidia stands at 36 MH/s. The 21% higher hash rate is due to memory and power consumption optimization of the video card.

It was assumed that a specialized mining card CMP 40HX would go on sale before the end of the first quarter of this year. Like all other models of specialized video cards of the CMP HX series, they will be distributed by NVIDIA partners. Asus was the first to announce possible prices for such cards: CMP 40HX could cost $699 and the younger model, CMP 30HX, whose mining efficiency is 26 MH/s, around $599.

AMD is also preparing a new GPU that will be designed for cryptocurrency mining. The cards will be based on Navi 10 and Navi 12 chips, which will be capable of mining Ether. AMD has stated that the new GPU would be released without VCN and Display Core Next DCN technologies, which will prevent them from streaming video to the display, once again, rendering them useless for gamers.

Known manufacturers of other mining equipment are not sitting on the sidelines either. Sabrent announced at the end of May the sale of PlotRipper SSDs for Chia Coin miners. The main advantage of the new SSDs is their larger capacity, which will be used gradually as the drives wear out. The PlotRipper and PlotRipper Pro models contain 4TB and 8TB NAND chips, respectively.

Is the end of crypto mining canceled?

The desire of manufacturers to separate their mining cards from gaming ones is understandable, especially when the company is experiencing problems with resources for the production and tarnishes its image in the process.

But in any production, the main thing is demand, which generates income. At the end of the first quarter of 2021, Nvidia made $155 million in revenue from the sales of GPUs designed specifically for cryptocurrency mining. In the second quarter of the fiscal year, it expects to generate $400 million.

Related: Top crypto mining hardware to expect in 2021

AMD also released its first-quarter report showing impressive revenue growth, recording a 93% rise to $3.45 billion over the same period last year. The management explained this dynamic by the surge in demand for consumer Ryzen processors and Radeon graphics cards. The average selling price has been rising in both the CPU and graphics segment. In fact, the revenue from the sales of client processors and their average price have reached record levels.

Thus, if companies continue to make such profits, in which cryptocurrency mining plays an important role, then it is likely that chip manufacturers would be willing to cater to all avenues of customers with specialized products. It may actually be that mining is not only alive and well but, in the face of a sharp drop in crypto prices, may actually come out stronger as the result.

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Chronic stress and inflammation linked to societal and environmental impacts in new study

From anxiety about the state of the world to ongoing waves of Covid-19, the stresses we face can seem relentless and even overwhelming. Worse, these stressors…

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From anxiety about the state of the world to ongoing waves of Covid-19, the stresses we face can seem relentless and even overwhelming. Worse, these stressors can cause chronic inflammation in our bodies. Chronic inflammation is linked to serious conditions such as cardiovascular disease and cancer – and may also affect our thinking and behavior.   

Credit: Image: Vodovotz et al/Frontiers

From anxiety about the state of the world to ongoing waves of Covid-19, the stresses we face can seem relentless and even overwhelming. Worse, these stressors can cause chronic inflammation in our bodies. Chronic inflammation is linked to serious conditions such as cardiovascular disease and cancer – and may also affect our thinking and behavior.   

A new hypothesis published in Frontiers in Science suggests the negative impacts may extend far further.   

“We propose that stress, inflammation, and consequently impaired cognition in individuals can scale up to communities and populations,” explained lead author Prof Yoram Vodovotz of the University of Pittsburgh, USA.

“This could affect the decision-making and behavior of entire societies, impair our cognitive ability to address complex issues like climate change, social unrest, and infectious disease – and ultimately lead to a self-sustaining cycle of societal dysfunction and environmental degradation,” he added.

Bodily inflammation ‘mapped’ in the brain  

One central premise to the hypothesis is an association between chronic inflammation and cognitive dysfunction.  

“The cause of this well-known phenomenon is not currently known,” said Vodovotz. “We propose a mechanism, which we call the ‘central inflammation map’.”    

The authors’ novel idea is that the brain creates its own copy of bodily inflammation. Normally, this inflammation map allows the brain to manage the inflammatory response and promote healing.   

When inflammation is high or chronic, however, the response goes awry and can damage healthy tissues and organs. The authors suggest the inflammation map could similarly harm the brain and impair cognition, emotion, and behavior.   

Accelerated spread of stress and inflammation online   

A second premise is the spread of chronic inflammation from individuals to populations.  

“While inflammation is not contagious per se, it could still spread via the transmission of stress among people,” explained Vodovotz.   

The authors further suggest that stress is being transmitted faster than ever before, through social media and other digital communications.  

“People are constantly bombarded with high levels of distressing information, be it the news, negative online comments, or a feeling of inadequacy when viewing social media feeds,” said Vodovotz. “We hypothesize that this new dimension of human experience, from which it is difficult to escape, is driving stress, chronic inflammation, and cognitive impairment across global societies.”   

Inflammation as a driver of social and planetary disruption  

These ideas shift our view of inflammation as a biological process restricted to an individual. Instead, the authors see it as a multiscale process linking molecular, cellular, and physiological interactions in each of us to altered decision-making and behavior in populations – and ultimately to large-scale societal and environmental impacts.  

“Stress-impaired judgment could explain the chaotic and counter-intuitive responses of large parts of the global population to stressful events such as climate change and the Covid-19 pandemic,” explained Vodovotz.  

“An inability to address these and other stressors may propagate a self-fulfilling sense of pervasive danger, causing further stress, inflammation, and impaired cognition in a runaway, positive feedback loop,” he added.  

The fact that current levels of global stress have not led to widespread societal disorder could indicate an equally strong stabilizing effect from “controllers” such as trust in laws, science, and multinational organizations like the United Nations.   

“However, societal norms and institutions are increasingly being questioned, at times rightly so as relics of a foregone era,” said Prof Paul Verschure of Radboud University, the Netherlands, and a co-author of the article. “The challenge today is how we can ward off a new adversarial era of instability due to global stress caused by a multi-scale combination of geopolitical fragmentation, conflicts, and ecological collapse amplified by existential angst, cognitive overload, and runaway disinformation.”    

Reducing social media exposure as part of the solution  

The authors developed a mathematical model to test their ideas and explore ways to reduce stress and build resilience.  

“Preliminary results highlight the need for interventions at multiple levels and scales,” commented co-author Prof Julia Arciero of Indiana University, USA.  

“While anti-inflammatory drugs are sometimes used to treat medical conditions associated with inflammation, we do not believe these are the whole answer for individuals,” said Dr David Katz, co-author and a specialist in preventive and lifestyle medicine based in the US. “Lifestyle changes such as healthy nutrition, exercise, and reducing exposure to stressful online content could also be important.”  

“The dawning new era of precision and personalized therapeutics could also offer enormous potential,” he added.  

At the societal level, the authors suggest creating calm public spaces and providing education on the norms and institutions that keep our societies stable and functioning.  

“While our ‘inflammation map’ hypothesis and corresponding mathematical model are a start, a coordinated and interdisciplinary research effort is needed to define interventions that would improve the lives of individuals and the resilience of communities to stress. We hope our article stimulates scientists around the world to take up this challenge,” Vodovotz concluded.  

The article is part of the Frontiers in Science multimedia article hub ‘A multiscale map of inflammatory stress’. The hub features a video, an explainer, a version of the article written for kids, and an editorial, viewpoints, and policy outlook from other eminent experts: Prof David Almeida (Penn State University, USA), Prof Pietro Ghezzi (University of Urbino Carlo Bo, Italy), and Dr Ioannis P Androulakis (Rutgers, The State University of New Jersey, USA). 


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Acadia’s Nuplazid fails PhIII study due to higher-than-expected placebo effect

After years of trying to expand the market territory for Nuplazid, Acadia Pharmaceuticals might have hit a dead end, with a Phase III fail in schizophrenia…

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After years of trying to expand the market territory for Nuplazid, Acadia Pharmaceuticals might have hit a dead end, with a Phase III fail in schizophrenia due to the placebo arm performing better than expected.

Steve Davis

“We will continue to analyze these data with our scientific advisors, but we do not intend to conduct any further clinical trials with pimavanserin,” CEO Steve Davis said in a Monday press release. Acadia’s stock $ACAD dropped by 17.41% before the market opened Tuesday.

Pimavanserin, a serotonin inverse agonist and also a 5-HT2A receptor antagonist, is already in the market with the brand name Nuplazid for Parkinson’s disease psychosis. Efforts to expand into other indications such as Alzheimer’s-related psychosis and major depression have been unsuccessful, and previous trials in schizophrenia have yielded mixed data at best. Its February presentation does not list other pimavanserin studies in progress.

The Phase III ADVANCE-2 trial investigated 34 mg pimavanserin versus placebo in 454 patients who have negative symptoms of schizophrenia. The study used the negative symptom assessment-16 (NSA-16) total score as a primary endpoint and followed participants up to week 26. Study participants have control of positive symptoms due to antipsychotic therapies.

The company said that the change from baseline in this measure for the treatment arm was similar between the Phase II ADVANCE-1 study and ADVANCE-2 at -11.6 and -11.8, respectively. However, the placebo was higher in ADVANCE-2 at -11.1, when this was -8.5 in ADVANCE-1. The p-value in ADVANCE-2 was 0.4825.

In July last year, another Phase III schizophrenia trial — by Sumitomo and Otsuka — also reported negative results due to what the company noted as Covid-19 induced placebo effect.

According to Mizuho Securities analysts, ADVANCE-2 data were disappointing considering the company applied what it learned from ADVANCE-1, such as recruiting patients outside the US to alleviate a high placebo effect. The Phase III recruited participants in Argentina and Europe.

Analysts at Cowen added that the placebo effect has been a “notorious headwind” in US-based trials, which appears to “now extend” to ex-US studies. But they also noted ADVANCE-1 reported a “modest effect” from the drug anyway.

Nonetheless, pimavanserin’s safety profile in the late-stage study “was consistent with previous clinical trials,” with the drug having an adverse event rate of 30.4% versus 40.3% with placebo, the company said. Back in 2018, even with the FDA approval for Parkinson’s psychosis, there was an intense spotlight on Nuplazid’s safety profile.

Acadia previously aimed to get Nuplazid approved for Alzheimer’s-related psychosis but had many hurdles. The drug faced an adcomm in June 2022 that voted 9-3 noting that the drug is unlikely to be effective in this setting, culminating in a CRL a few months later.

As for the company’s next R&D milestones, Mizuho analysts said it won’t be anytime soon: There is the Phase III study for ACP-101 in Prader-Willi syndrome with data expected late next year and a Phase II trial for ACP-204 in Alzheimer’s disease psychosis with results anticipated in 2026.

Acadia collected $549.2 million in full-year 2023 revenues for Nuplazid, with $143.9 million in the fourth quarter.

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Digital Currency And Gold As Speculative Warnings

Over the last few years, digital currencies and gold have become decent barometers of speculative investor appetite. Such isn’t surprising given the evolution…

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Over the last few years, digital currencies and gold have become decent barometers of speculative investor appetite. Such isn’t surprising given the evolution of the market into a “casino” following the pandemic, where retail traders have increased their speculative appetites.

“Such is unsurprising, given that retail investors often fall victim to the psychological behavior of the “fear of missing out.” The chart below shows the “dumb money index” versus the S&P 500. Once again, retail investors are very long equities relative to the institutional players ascribed to being the “smart money.””

“The difference between “smart” and “dumb money” investors shows that, more often than not, the “dumb money” invests near market tops and sells near market bottoms.”

Net Smart Dumb Money vs Market

That enthusiasm has increased sharply since last November as stocks surged in hopes that the Federal Reserve would cut interest rates. As noted by Sentiment Trader:

“Over the past 18 weeks, the straight-up rally has moved us to an interesting juncture in the Sentiment Cycle. For the past few weeks, the S&P 500 has demonstrated a high positive correlation to the ‘Enthusiasm’ part of the cycle and a highly negative correlation to the ‘Panic’ phase.”

Investor Enthusiasm

That frenzy to chase the markets, driven by the psychological bias of the “fear of missing out,” has permeated the entirety of the market. As noted in This Is Nuts:”

“Since then, the entire market has surged higher following last week’s earnings report from Nvidia (NVDA). The reason I say “this is nuts” is the assumption that all companies were going to grow earnings and revenue at Nvidia’s rate. There is little doubt about Nvidia’s earnings and revenue growth rates. However, to maintain that growth pace indefinitely, particularly at 32x price-to-sales, means others like AMD and Intel must lose market share.”

Nvidia Price To Sales

Of course, it is not just a speculative frenzy in the markets for stocks, specifically anything related to “artificial intelligence,” but that exuberance has spilled over into gold and cryptocurrencies.

Birds Of A Feather

There are a couple of ways to measure exuberance in the assets. While sentiment measures examine the broad market, technical indicators can reflect exuberance on individual asset levels. However, before we get to our charts, we need a brief explanation of statistics, specifically, standard deviation.

As I discussed in “Revisiting Bob Farrell’s 10 Investing Rules”:

“Like a rubber band that has been stretched too far – it must be relaxed in order to be stretched again. This is exactly the same for stock prices that are anchored to their moving averages. Trends that get overextended in one direction, or another, always return to their long-term average. Even during a strong uptrend or strong downtrend, prices often move back (revert) to a long-term moving average.”

The idea of “stretching the rubber band” can be measured in several ways, but I will limit our discussion this week to Standard Deviation and measuring deviation with “Bollinger Bands.”

“Standard Deviation” is defined as:

“A measure of the dispersion of a set of data from its mean. The more spread apart the data, the higher the deviation. Standard deviation is calculated as the square root of the variance.”

In plain English, this means that the further away from the average that an event occurs, the more unlikely it becomes. As shown below, out of 1000 occurrences, only three will fall outside the area of 3 standard deviations. 95.4% of the time, events will occur within two standard deviations.

Standard Deviation Chart

A second measure of “exuberance” is “relative strength.”

“In technical analysis, the relative strength index (RSI) is a momentum indicator that measures the magnitude of recent price changes to evaluate overbought or oversold conditions in the price of a stock or other asset. The RSI is displayed as an oscillator (a line graph that moves between two extremes) and can read from 0 to 100.

Traditional interpretation and usage of the RSI are that values of 70 or above indicate that a security is becoming overbought or overvalued and may be primed for a trend reversal or corrective pullback in price. An RSI reading of 30 or below indicates an oversold or undervalued condition.” – Investopedia

With those two measures, let’s look at Nvidia (NVDA), the poster child of speculative momentum trading in the markets. Nvidia trades more than 3 standard deviations above its moving average, and its RSI is 81. The last time this occurred was in July of 2023 when Nvidia consolidated and corrected prices through November.

NVDA chart vs Bollinger Bands

Interestingly, gold also trades well into 3 standard deviation territory with an RSI reading of 75. Given that gold is supposed to be a “safe haven” or “risk off” asset, it is instead getting swept up in the current market exuberance.

Gold vs Bollinger Bands

The same is seen with digital currencies. Given the recent approval of spot, Bitcoin exchange-traded funds (ETFs), the panic bid to buy Bitcoin has pushed the price well into 3 standard deviation territory with an RSI of 73.

Bitcoin vs Bollinger Bands

In other words, the stock market frenzy to “buy anything that is going up” has spread from just a handful of stocks related to artificial intelligence to gold and digital currencies.

It’s All Relative

We can see the correlation between stock market exuberance and gold and digital currency, which has risen since 2015 but accelerated following the post-pandemic, stimulus-fueled market frenzy. Since the market, gold and cryptocurrencies, or Bitcoin for our purposes, have disparate prices, we have rebased the performance to 100 in 2015.

Gold was supposed to be an inflation hedge. Yet, in 2022, gold prices fell as the market declined and inflation surged to 9%. However, as inflation has fallen and the stock market surged, so has gold. Notably, since 2015, gold and the market have moved in a more correlated pattern, which has reduced the hedging effect of gold in portfolios. In other words, during the subsequent market decline, gold will likely track stocks lower, failing to provide its “wealth preservation” status for investors.

SP500 vs Gold

The same goes for cryptocurrencies. Bitcoin is substantially more volatile than gold and tends to ebb and flow with the overall market. As sentiment surges in the S&P 500, Bitcoin and other cryptocurrencies follow suit as speculative appetites increase. Unfortunately, for individuals once again piling into Bitcoin to chase rising prices, if, or when, the market corrects, the decline in cryptocurrencies will likely substantially outpace the decline in market-based equities. This is particularly the case as Wall Street can now short the spot-Bitcoin ETFs, creating additional selling pressure on Bitcoin.

SP500 vs Bitcoin

Just for added measure, here is Bitcoin versus gold.

Gold vs Bitcoin

Not A Recommendation

There are many narratives surrounding the markets, digital currency, and gold. However, in today’s market, more than in previous years, all assets are getting swept up into the investor-feeding frenzy.

Sure, this time could be different. I am only making an observation and not an investment recommendation.

However, from a portfolio management perspective, it will likely pay to remain attentive to the correlated risk between asset classes. If some event causes a reversal in bullish exuberance, cash and bonds may be the only place to hide.

The post Digital Currency And Gold As Speculative Warnings appeared first on RIA.

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