Good morning. Here’s what happens:
Prices: Bitcoin hovers around $20,000 for ninth straight day. Binance plans to end exchange support for three stablecoins that compete with its own BUSD.
Information: With the end of Ethereum’s proof-of-work mining on the horizon, thanks to the upcoming Merge and its shift to a proof-of-stake blockchain system, prices for GPUs are dropping like a rock, reports Sam Reynolds.
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●Bitcoin (BTC): $19,726 -0.7%
●Ether (ETH): $1,593 +1.4%
●S&P 500 daily close: 3,924.26 -1.1%
●Gold: $1,721 per troy ounce +0.7%
●10-year bond yield daily close: 3.19% −0.07
Bitcoin, Ether, and Gold prices are taken at approximately 4 p.m. New York time. Bitcoin is the CoinDesk Bitcoin Price Index (XBX). Ether is the CoinDesk Ether Price Index (ETX). Gold is the COMEX spot price. Information on CoinDesk indices can be found at coindesk.com/indices.
Bitcoin Waffles Around $20,000 And Binance
By Bradley Keown
Bitcoin (BTC) hovered around $20,000 for the ninth straight day, with traditional markets mostly closed in the US for the Labor Day holiday.
As of press time, the largest cryptocurrency was changing hands around $19,800, down 0.7% in the past 24 hours. Ether (ETH), the second-largest cryptocurrency, rose 1.7% to $1,598.
Crypto analysts have been looking at a pattern in blockchain data known as “idle supply peaks,” suggesting that bitcoin may be poised for a rally. Another metric called Puell Multiple suggests that long-term investors have added to their holdings as prices decline.
Binancethe world’s largest cryptocurrency exchange, said it will stop supporting stablecoins USDC, USDP and TUSD, with a plan to automatically convert users’ holdings of these coins to its own stablecoin, BUSD, on September 29.
Poolinone of the largest bitcoin mining pools, has suspended withdrawals as part of an effort to preserve assets and stabilize liquidity.
A Brazilian financial regulator has banned Singapore-based crypto exchange Bybit from securities brokerage.
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Prices for GPU Computing Chips Slip Towards MSRP as Ethereum Merger Approaches
By Sam Reynolds
As cryptocurrencies entered the mainstream, the price of graphics processing units (GPUs) for personal computers was often tied to the fate of the cryptocurrency market – after they became popular for cryptocurrency mining. Now, with the end of Ethereum proof-of-work mining on the horizon, thanks to the upcoming Merge and its shift to a proof-of-stake blockchain system, prices for GPUs are dropping like a rock.
A bull market for crypto has, in the recent past, a bull market for GPU prices. At the height of Ether’s rally in 2021, some of the most powerful GPUs were selling for an average of 114% above their manufacturer’s suggested retail price (MSRP). After all, for proof-of-work protocols—what Ethereum currently is, since its launch in 2015—GPUs and their parallel processing capability have been essential for mining.
But that was before The Merge. Ethereum’s shift from computationally intensive proof-of-work to proof-of-stake means that the tens of millions of GPUs purchased over the past four years to mine ether are now of no use. Some miners are considering moving their operations to Ethereum Classic, but despite the fact that the protocol has been around for almost six years, it simply hasn’t gathered the network effect needed to entice a critical mass of decentralized applications, NFTs or DeFi.
The GPU prices reflect this. According to data released by industry analyst Jon Peddie, overall GPU unit shipments fell 15% from last quarter. Part of that comes from the flattening of the PC market, with IDC analysts forecasting a 12.8% year-over-year decline in 2022. The rapid quarter-on-quarter decline in GPU prices is clearly blamed on demand from crypto miners evaporating .
According to GPUTracker.eu, prices for some of the most popular GPUs are in the double digits. The RTX 3080 Ti, once a miner favorite, has seen its average selling price drop 45% in the last quarter, putting it near MSRP. In February, the card sold for about $2,000. now it’s just over $1,100.
In China, wholesalers can’t get rid of these cards fast enough as inventory builds up from mining farms trying to offload supply.
All this is felt in the essence of Nvidia. During recent earnings, the company said its gaming line (read: GPUs used for mining) fell 33% year over year to $2.04 billion — sharper than executives expected. Dedicated cryptocurrency mining chip revenue also declined, but sales of those chips represent a small fraction of the silicon the company sold to miners.
In many ways, Nvidia executives couldn’t be happier. Jensen Huang, CEO of Nvidia, has never been too comfortable with miners stealing what he thought should be for gamers or other users of the chips.
“Gaming is growing, workstation is growing, AI hyperscale data center is growing, high performance computing is growing. Frankly, I would prefer our GPUs to be built to be used in those areas,” he was quoted as saying at the company’s annual technology conference in 2018. “My preference would, of course, be to make them available for the people we build them for, but there is a logical reason [they use] Nvidia GPU, because it’s the world’s largest distributed supercomputer.”
It looks like Huang and Nvidia will have their way. They just need the trouble to deal with a few quarters of the downturn coming just as the broader computing sector is coming out of the Covid supercycle. The question is, will it recover as quickly without mining? Investors and the SEC would like to know.
Ether Eyes Price Rally After ‘Wedge’ Breakout, But Europe’s Energy Crisis Kills Risk Appetite: Ether looked north, having broken out of a falling wedge pattern last week, analysts said. Buyers remained on the sidelines early Monday as a worsening energy crisis in Europe eroded risk appetite.
Citi: Ether Extends Pre-Merger Rally Despite Bitcoin Weakness: There are key differences between previous upgrades to the Ethereum blockchain and now, as the digital asset faces tighter economic conditions for the first time, the bank said.
Parabolic Bitcoin bull may run after coin’s dormant supply peaks, past data suggests: Dormant supply peaks are springboards for bullish price action, one observer said.
Poolin, one of the world’s largest Bitcoin mining pools, acknowledges liquidity issues: Poolin CEO and founder Kevin Pan assured users that funds are safe and said the company may seek debt to solve the problems its liquidity.
LG Selects Little-Known Hedera Blockchain for TV NFTs: The consumer electronics company, which has served on Hedera’s Board of Directors since 2020, is bringing NFTs to TV screens through a platform built on the Hedera network.
Australian Federal Police forms cryptocurrency unit to tackle money laundering: The unit was established after the force’s criminal asset forfeiture command seized more than $600 million in proceeds of crime since its inception in February 2020.