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Cryptocurrencies have been the new wave and even though not everyone is in bed with the idea that they are they currency of the future. However, they haven’t had a very good time this year compared to their impressive end of 2017 run. If you have been seeing anything like “bearish” run on the internet lately, well it’s a reference to this poor performance by cryptocurrencies. This has cost most cryptocurrency investors quite an awful lot. Despite all this, some people seem to be getting a rather good time in terms of stocks that are triggered by cryptocurrencies.

Ethereum, one of the most popular cryptocurrencies, appears to be bringing profits to semiconductor creators Advanced Micro Devices (AMD) and NVidia. According to reports by Morgan Stanley analysts on Tuesday, Ethereum prices are up about 8,900% coming from last year. This means one very important thing, mining of Ethereum has in turn become very profitable at over 200% up since last October. But then these coins don’t mine on just any kind computer. They require very heavy graphic processing units to mine and that’s where AMD and NVidia come into the picture.

Ethereum Mining – AMD/NVidia Stocks Rise Correlation

sample of ethereum mining gpuThe report states that mining Ethereum today brings in close to $1.76 daily per every graphic processing unit (GPU) owned. Assuming the miner owns an AMD Radeon 580 and pays 70 cents a day for electricity used for every GPU.
The analysts from the bank computed the profitability of the mining of Ethereum and the power it consumes to boost the estimates of sales made by AMD and NVidia in the final quarter of last year. NVidia and AMD had a sales boost back in 2017 due to the rise in the demand for their GPUs to mine cryptocurrencies. The analysts say they are expecting the revenues AMD will post for both the last quarter of 2017 and the first of 2018 to be $1.55 billion and $1.43 billion respectively. And for NVidia it expects revenues of $2.81 billion and $2.55 for the first and second quarters of 2018 respectively based on their calculations and estimations.

What’s interesting is that the stocks of both firms had risen by 2% for each of them.

Because of how interest in cryptocurrencies keeps rising by the day, the price of the GPUs required for mining have also soared. What’s not so nice for the miners is that the higher these prices get the lesser the profit they will make. The analysts however stated that these figures were based on estimates, reasonable estimates.

“We are raising estimates meaningfully for both graphics vendors, but sustainability is a long-term issue especially for AMD,” Morgan Stanley analysts wrote Tuesday.

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