In an interview with CNBC, Nvidia’s CEO explains why he thinks cryptocurrency and blockchain technologies are here to stay. Nvidia’s GPUs are in demand for cryptocurrency mining, however, Huang doesn’t see processors as a core market for Nvidia.
Huang’s comments on March 29th, 2018, were in answer to concerns that Nvidia’s share price growth was unsustainable. as recent profit hikes stem, in part, from sales of GPUs for cryptocurrency mining. The volatility of cryptocurrency markets makes GPU demand unreliable.
“Cryptocurrency will be here. The ability for the world to have a very low-friction, low-cost way of exchanging value is going to be here for a long time. Blockchain’s going to be here for a long time and it’s going to be a fundamental new form of computing,” said Huang. “I expect blockchain, I expect cryptocurrency to be an important driver for GPUs.”
A nimble approach to volatility
With Nvidia stock up 560% overall in two years, its infiltration into a number of emerging technologies, including blockchain, artificial intelligence, and autonomous vehicles is certainly producing results. Though Huang actually sees gaming, data centres, professional graphics and the autonomous market as Nvidia’s largest growth drivers, with cryptocurrencies adding an “extra bit of juice.”
There are very few who could have predicted the massive growth of cryptocurrencies, cryptocurrency mining and blockchain technology.
In November 2017, Nvidia said it would remain “nimble” in its approach to cryptocurrencies after third-quarter 2017 revenue from mining-related products fell by $80 million, compared to second quarter results. By the end of 2017, Nvidia’s revenue from cryptocurrency mining-related products was on the way back up.
Demand for GPUs
Nvidia has been accelerating development of its graphics processing units (GPUs) for a number of years and heavily invested in GPU technology to handle non-graphical functions. Nvidia is now developing supercomputers, perfect Huang says, for artificial intelligence researchers.
The parallel processing technology of Nvidia GPUs makes them popular with cryptocurrency miners and blockchain operators. Demand is so high there is a market shortage of Nvidia products.
In an interview on March 27th, 2018, this time with TechCrunch, Huang expressed some frustration that gamers were missing out on Nvidia GPUs.
“We’re sold out of many of our high-end SKUs, and so it’s a real challenge keeping [graphic cards] in the marketplace for games,” said Huang. “At the highest level the way to think about that is because of the philosophy of cryptocurrency — which is really about taking advantage of distributed high-performance computing — there are supercomputers in the hands of almost everybody in the world so that no singular force or entity that can control the currency.”
Huang described the problem “as a good one to have” and said Nvidia is working to come closer to the demand of the market.