Report: Cryptocurrency Mining Will Boost AMD and Nvidia Stock Prices

At least one major Wall Street firm expects that the stock prices for Nvidia and Advanced Micro Devices Inc. (AMD) will continue climbing as both companies continue to pursue opportunities in the cryptocurrency mining market.

Nvidia has seen its stock jump almost 180 percent over the last year, while AMD has jumped 112 percent as well, thanks to cryptocurrency miners’ extensive need for powerful graphics processing units (GPUs). Global investment banking firm Jefferies believes the market for GPUs will remain strong over the next several months, according to a new report.

According to a client note written by Jefferies analyst Mark Lipacis, the stocks are the market’s top performers for the past year – a state of affairs that is expected to continue looking ahead.

In the letter (quoted by CNBC), Lipacis said:

« We think that the risk of a ‘crypto-driven’ inventory correction driving material downside is low in the near term … Both AMD and NVDA have introduced ‘cryptospecific GPU [stock-keeping unit]’ that have a low risk of competing with core gaming GPUs in secondary markets. »

Both companies have taken advantage of cryptocurrency mining by developing and selling GPU models specific to that market. Cryptocurrency mining is an energy intensive process by which new transactions are added to a blockchain, creating new coins in the process as a reward.

Looking ahead

In the long-term, Lipacis does not expect either company to have to compete with second-hand equipment being sold by miners after they are through with the machines.

At the same time, Lipacis suggested that GPU prices could dip, an eventuality that may have an impact on the stock prices.

Even if the market for mining GPUs collapses, Lipacis does not believe it will have a major impact on either company’s bottom line. He expects AMD to undergo a 3% drop and Nvidia to undergo a 10% decrease in the event of a major catastrophe.

As previously reported, both companies have moved to capitalize on the interest in GPUs among the world’s miners. Nvidia’s CEO, Jen-Hsun Huang, recently declared that « cryptocurrencies and blockchain are here to stay, » signaling his firm’s long-term plans for the market.

While AMD hasn’t been as outwardly bullish in its own public statements, the company has seen significant interest in its products from miners as well.

Image Credit: MAX SAYPLAY / Shutterstock.com

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Disclaimer: This article should not be taken as, and is not intended to provide, investment advice. Please conduct your own thorough research before investing in any cryptocurrency.

Source: Report: Cryptocurrency Mining Will Boost AMD and Nvidia Stock Prices

Bitcoin Drops Below $4,000 as Market Mood Turns Uncertain

After mounting a modest recovery in the wake of rumored regulatory scrutiny, the price of bitcoin is back below $4,000.

The average price of bitcoin across global exchanges fell below $4,000 at roughly 3:15 UTC today, hitting a low not observed since September 10. The movement followed a period in which the bitcoin price repeatedly tested $4,000, but succeeded in staying above the barrier.

All in all, the move comes during an uncertain time for the cryptocurrency market, which has seen a period of sideways trading following a torrid first half in 2017.

With the recent decline, the price of bitcoin is up just 1.7 percent over the last month, though it has still appreciated nearly 300% this year. Likewise, the broader cryptocurrency markets have seen similar activity, rising 3.4% over the last 30 days, but declining more than 17 percent from its highest point during the period, according to CoinMarketCap.

As for the current sentiment, continued rumors that China could move to close domestic order-book exchanges have no doubt concerned more casual investors (while providing opportunities for profit-taking from long-term bulls).

Fanning the flames have been statements from notable community figures that appear to attest to the accuracy of the claims, though details on the primary sources for that information have not been forthcoming.

China-based exchanges continue to operate normally at press time, indicating they have yet to be notified of any operational changes.

Pipe dripping via Shutterstock

The leader in blockchain news, CoinDesk is an independent media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. Have breaking news or a story tip to send to our journalists? Contact us at [email protected].

Disclaimer: This article should not be taken as, and is not intended to provide, investment advice. Please conduct your own thorough research before investing in any cryptocurrency.

Source: Bitcoin Drops Below $4,000 as Market Mood Turns Uncertain