A Look At Chipmakers In The Wake Of The Ethereum Merge. Is There Still Demand For Graphics Cards?

A Look At Chipmakers In The Wake Of The Ethereum Merge. Is There Still Demand For Graphics Cards?

Considered the world’s most actively used blockchain network, Ethereum (CRYPTO: ETH) has successfully transitioned from a mining and energy-intensive proof-of-work (PoW) consensus mechanism to a proof-of-stake (PoS) model that replaces miners with validators.

Dubbed as The Merge, this move has been touted to help improve Ethereum’s scalability, reduce its energy requirements and make its entire ecosystem more secure.

However, the elimination of the need to mine Ethereum will undoubtedly impact the overall global graphic processing unit (GPU) demand, casting doubt over the future growth potential of chipmakers like NVIDIA Corporation (NASDAQ: NASDAQ:NVDA), Advanced Micro Devices Inc. (NASDAQ: NASDAQ:AMD) and others.

Delving into Nvidia’s quarterly results to understand the revenue share of GPUs in its overall business does paint a less extreme picture than what is being surmised.

ETH upgrade to impact NVIDIA revenue:

Lian Offering a viewpoint on how Ethereum’s transition will impact NVIDIA and other chipmakers, thought leader and best-selling author Anndy Lian says, “The Merge will completely remove the need for miners, who are currently securing the Ethereum network. They will replace them with validators. This upgrade would lead to a big revenue miss for NVIDIA, whose stock was down by nearly 20% compared to the previous quarter, associated to a slowdown in the gaming business and weakness in the global markets.”

The impact of the change to POS would be reduced if the forked POW chains can keep their demand high, getting support from big miners and backed by strong communities who believe that POW is the core value.

“If this is executed properly with the support of companies like NVIDIA, this market push is likely to put these listed chipmakers in a much better position,” Lian adds.

The world leader in the discrete graphics card business, NVIDIA’s graphics business contributes to 58% of the company’s revenues and 62% of its operating income, according to Investopedia.

This includes the GeForce GPUs, GeForce NOW game-streaming service and solutions for gaming platforms provided by NVIDIA.

GPU market to post healthy growth

Despite the fact that sales for the GeForce GPU will be affected by the drop in GPU demand on account of Ethereum’s design change, analysts expect the overall GPU market to post healthy growth rates over the next five years due to strong demand from the gaming industry.

What is worrisome, however, will be the loss of pricing power that companies like NVIDIA enjoyed as long as the semiconductor chip shortage lasted.

With demand pressures and pricing challenges increasing, chipmakers like NVIDIA will need to aggressively focus on other verticals to maintain profit margins.

Echoing this sentiment, Raj Kapoor, Founder and CEO of India Blockchain Alliance says that Ethereum is not the only coin that mines decently on a graphics card and that Beam and Ravencoin are actually similarly profitable at this time, and even when ETH mining stops, those would still continue.

According to experts, post The Merge, crypto miners will be looking elsewhere for mining opportunities as long as there are other coins that will reward them for their effort.

“It is also possible that combined with the great crypto value crash of 2022, some miners decide to get out of the business altogether. Some may even try and make their own forked version of Ethereum, one that requires mining and no rules. We would probably see increased availability of second-hand GPUs that have been mined to bits as a result of the second-largest crypto moving away from mining,” Kapoor says.

He adds that with ETH’s move to PoS being in the cards for a long time, most miners will have planned ahead with alternative money-making endeavors.

Once the flooding of GPUs in the used market stops, GPU demand would revert back to previous levels, unless there is some other factor that reduces the overall demand.

With the increased usage of computers for entertainment and work purposes being a trend that will stay, eventually, all forces will balance out again.

As for companies like NVIDIA that are involved in the manufacturing and distribution of GPUs, they’re already bundling them with other products and exploring other business verticals to supplement their profits, he further says.

While the short-term effect of Ethereum’s shift to a PoS model will dent sales for NVIDIA and other chipmakers, the overall growth story for GPUs and allied services seems intact.

Moreover, as these companies expand their range of products and services into areas such as Artificial Intelligence (AI), their reliance on the crypto world will eventually fade away and will be replaced by Web3-focused consumer products in the near future.

 

Source: https://uk.investing.com/news/cryptocurrency-news/a-look-at-chipmakers-in-the-wake-of-the-ethereum-merge-is-there-still-demand-for-graphics-cards-2754422

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

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A Look At Chipmakers In The Wake Of The Ethereum Merge. Is There Still Demand For Graphics Cards?

A Look At Chipmakers In The Wake Of The Ethereum Merge. Is There Still Demand For Graphics Cards?
ZINGER KEY POINTS
  • Ethereum blockchain has switched to a Proof-of-stake consensus model
  • The complete stoppage of mining Ethereum tokens will have a perceptible but temporary impact on leading chipmakers.

Considered the world’s most actively used blockchain network, Ethereum has successfully transitioned from a mining and energy-intensive proof-of-work (PoW) consensus mechanism to a proof-of-stake (PoS) model that replaces miners with validators.

Dubbed as The Merge, this move has been touted to help improve Ethereum’s scalability, reduce its energy requirements and make its entire ecosystem more secure.

However, the elimination of the need to mine Ethereum will undoubtedly impact the overall global graphic processing unit (GPU) demand, casting doubt over the future growth potential of chipmakers like NVIDIA Corporation, Advanced Micro Devices Inc. and others.

Delving into Nvidia’s quarterly results to understand the revenue share of GPUs in its overall business does paint a less extreme picture than what is being surmised.

ETH upgrade to impact NVIDIA revenue: Lian

Offering a viewpoint on how Ethereum’s transition will impact NVIDIA and other chipmakers, thought leader and best-selling author Anndy Lian says, “The Merge will completely remove the need for miners, who are currently securing the Ethereum network. They will replace them with validators. This upgrade would lead to a big revenue miss for NVIDIA, whose stock was down by nearly 20% compared to the previous quarter, associated to a slowdown in the gaming business and weakness in the global markets.”

“If this is executed properly with the support of companies like NVIDIA, this market push is likely to put these listed chipmakers in a much better position,” Lian adds.

The world leader in the discrete graphics card business, NVIDIA’s graphics business contributes to 58% of the company’s revenues and 62% of its operating income, according to Investopedia.

This includes the GeForce GPUs, GeForce NOW game-streaming service and solutions for gaming platforms provided by NVIDIA.

GPU market to post healthy growth

Despite the fact that sales for the GeForce GPU will be affected by the drop in GPU demand on account of Ethereum’s design change, analysts expect the overall GPU market to post healthy growth rates over the next five years due to strong demand from the gaming industry.

What is worrisome, however, will be the loss of pricing power that companies like NVIDIA enjoyed as long as the semiconductor chip shortage lasted.

With demand pressures and pricing challenges increasing, chipmakers like NVIDIA will need to aggressively focus on other verticals to maintain profit margins.

Echoing this sentiment, Raj Kapoor, Founder and CEO of India Blockchain Alliance says that Ethereum is not the only coin that mines decently on a graphics card and that Beam and Ravencoin are actually similarly profitable at this time, and even when ETH mining stops, those would still continue.

According to experts, post The Merge, crypto miners will be looking elsewhere for mining opportunities as long as there are other coins that will reward them for their effort.

“It is also possible that combined with the great crypto value crash of 2022, some miners decide to get out of the business altogether. Some may even try and make their own forked version of Ethereum, one that requires mining and no rules. We would probably see increased availability of second-hand GPUs that have been mined to bits as a result of the second-largest crypto moving away from mining,” Kapoor says.

He adds that with ETH’s move to PoS being in the cards for a long time, most miners will have planned ahead with alternative money-making endeavors.

Once the flooding of GPUs in the used market stops, GPU demand would revert back to previous levels, unless there is some other factor that reduces the overall demand.

With the increased usage of computers for entertainment and work purposes being a trend that will stay, eventually, all forces will balance out again.

As for companies like NVIDIA that are involved in the manufacturing and distribution of GPUs, they’re already bundling them with other products and exploring other business verticals to supplement their profits, he further says.

While the short-term effect of Ethereum’s shift to a PoS model will dent sales for NVIDIA and other chipmakers, the overall growth story for GPUs and allied services seems intact.

Moreover, as these companies expand their range of products and services into areas such as Artificial Intelligence (AI), their reliance on the crypto world will eventually fade away and will be replaced by Web3-focused consumer products in the near future.

 

Source: https://www.benzinga.com/markets/cryptocurrency/22/09/28897739/comprehending-the-impact-of-eth-merge-on-nvidia-and-other-chipmakers

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

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Fun at the foodverse: Are we there yet?

Fun at the foodverse: Are we there yet?

Can food and beverages be paired with blockchain technology?

There are some instances. In recent times, Starbucks, McDonald’s, Taco Bell, and Coca-Cola, among others, have collaborated with the blockchain industry. Michelin Star chef Vikas Khanna, who is no less than a brand himself, launched his 38th book Sacred Foods of India as an NFT (non-fungible token).

There are various ways in which the food and beverage sector can collaborate with blockchain, experts said. One way is for restaurants to include cryptos or NFTs in their reward and loyalty programmes, while another way could be to introduce customers to a food metaverse.
Experts call this a “natural progression” for food and blockchain tech. While youngsters are ready to give it a shot, some are doubtful about its prospects, given the concerns of the government and the regulatory authority over cryptocurrencies.

“Food chains getting into the crypto scene is a natural progression. In fact, the NFT and crypto strategy is no different from their current reward programmes. They can start from there to build more stickiness with their customers at a very young age, from NFT to games to “eat-to-earn” in their own metaverse,” Anndy Lian, former chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange, told Moneycontrol.

Imagine getting an NFT or crypto reward points at McDonald’s instead of a free  Happy Meal gift. That’s a template for food chains that want to collaborate with the crypto industry. Digital collectables such as NFTs could be valuable as a form of investment and a way for youngsters to learn about finances.

Hybrid stage

Ankitt Gaur, founder of EasyFi, a decentralised finance lending protocol, said a hybrid shift in the reward systems could be possible in the immediate future.

“A guest visiting a restaurant for a meal gets a physical reward there coupled with a digital asset like an NFT that can be redeemed in the future, traded in the open market or collected for a better value in the future, based on the rarity of the NFT,” Gaur said.

A Happy Meal with a free gift at McDonald’s not only excites kids but also makes people of all age groups happy.

Pranay Jain, founder of BodyFirst, a nutrition brand, said, “We know even older folks look forward to the comfort of a happy meal and the anticipation of an accompanying tiny toy. So why not introduce the demographic to the metaverse? More importantly, a collection of NFTs with happy meals or the likes across various fast food chains would probably bring a lot more than just the excitement of holding toys. It could just be the start of making investments in NFTs and cryptocurrencies.”

Anshita Mathur, 26, a manager at Axis Bank, doesn’t mind redeeming reward points into crypto or getting NFTs instead of physical free gifts.

“I think we’re over the age of physical collectables, and digital art is easier to hold and make a strong collection out of. I don’t think you can hold as much physical art as you can a digital collection,” she said.

Mukul Jain, 25, a product manager at ICICI Lombard, loves the idea of NFTs instead of physical collectables, but he doubts whether food chains will use blockchain for currency given the government’s compliance and tax norms.

A metaverse date

The other idea for collaboration is to create a foodverse – a virtual dining space. OneRare recently built a metaverse for food, gaming and NFTs on the blockchain ecosystem.

Now, imagine having a date in the foodverse where you and your partner meet as avatars in a restaurant-like setting.

“The younger generation is always at the forefront of any tech revolution and it will forefront the metaverse adoption as well,” said Supreet Raju, cofounder of OneRare. “A date in the foodverse could mean hanging out with your buddy when you can’t be in the same city or enjoying a virtual experience that earns you coffee NFT rewards that can be swapped for real-life coffees. A lot is possible with the power of blockchain technology.”

Raj Kapoor, founder of India Blockchain Alliance, said metaverse dating could be exciting.

“The entire concept could be intriguing, exciting, and even scary. We also may be looking to a future where we are always hooked into a virtual world. I fear it will be a dystopian nightmare,” he said.

Mathur finds the idea of metaverse dating interesting.

“The physical intimacy and emotional aspect might not be the same for me, but I am open to trying it out,” she said.

Rhea Mehta, 26, said that with metaverse dates, people would be able to discover more of each other’s personalities in a safer virtual space before actually meeting up.

“It would be interesting to see how food companies create online experiences for dating,” she said.

On the other hand, Arijit Mukherjee, founder of Yunometa, an NFT and metaverse marketplace, said it would be a “real challenge” to convince diners to be a part of this ecosystem. While youngsters might get excited about the idea, it will take time to convince people of all age groups.

“Youngsters would likely go on a virtual date with their avatars or celebrate close occasions in the metaverse if they’re far apart. Many other use cases will draw in youngsters to experiment and use this new technology. Just as there are social media kids today for whom tweeting and Instagramming is second nature, similarly a new generation will take to Web3 like fish to water and further popularise the technology,” he said.

On the whole, experts see a future for food and beverages with the metaverse and look forward to progressive collaboration between them.

Mukherjee said, “Don’t be surprised if your next social date is in the metaverse with your avatar in the very near future!”

 

Original Source: https://www.moneycontrol.com/news/business/companies/fun-at-the-foodverse-are-we-there-yet-9034761.html

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

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