Nvidia will design dedicated GPUs for Ethereum mining and limit the computing power of RTX 3060 graphics cards

Nvidia announced on Thursday that it will release semiconductor chips and graphics cards specifically for digital currency mining, and will reduce the mining efficiency of the RTX 3060 series graphics cards by 50% in subsequent product updates.

The new chip type is called CMP (Cryptocurrency Mining Processor). An Nvidia spokesperson said that the first batch of mining graphics cards will be available in March this year.

Ethereum mining is the process by which computers solve complex mathematical algorithms to keep the Ethereum network running. In exchange, miners receive Ethereum, the underlying digital currency running on the Ethereum network. ETH hit a new all-time high on Thursday, up more than 160% year-to-date to more than $1,914.

Ethereum's mining algorithm, ethash, runs best on Nvidia graphics cards . Ethereum miners often buy several graphics cards and put them in a single machine to maximize their earnings.

Last fall, Nvidia released a series of high-end graphics cards that are popular among PC gamers, and they have been sold out. The semiconductor chip industry is also facing a general shortage.

Thursday’s announcement suggests that at least some of the main demand for Nvidia graphics cards is coming from cryptocurrency miners, not just gamers.

" CMP chips - which do not support gaming graphics rendering - will be sold and optimized for the best mining performance and efficiency through authorized partners. CMP lacks display outputs, which makes it impossible to configure independent fans, so they can be installed more densely. CMP also has lower peak core voltage and frequency, which improves mining efficiency. Tailoring products for customers with specific needs can bring the greatest value to customers. With CMP, we can help miners build the most efficient data centers while reserving GeForce RTX series graphics cards for gamers. " Nvidia marketing head Mutt Wuebbling wrote in the blog " GeForce is born for games, CMP is born for miners . "

Nvidia said the latest chip in its line of gaming graphics cards, the RTX 3060, will have a modification when it is released later this year that will cut its Ethereum mining efficiency in half. Cards already on sale, such as the RTX 3070 or RTX 3080, don’t have the same limitation, an Nvidia representative said.

Nvidia official blog: "The RTX 3060 software driver is designed to detect specific properties of the Ethereum cryptocurrency mining algorithm and limit the hash rate or cryptocurrency mining efficiency to around 50%."

Graphics cards were originally developed to power high-definition computer games, but they are increasingly important for new technologies such as artificial intelligence. Their use in Ethereum mining is also nothing new — in 2017, Nvidia publicly stated that it was making hundreds of millions of dollars in profits each quarter from graphics cards sold to cryptocurrency miners.

“Cryptocurrency and blockchain are here to stay. There’s going to be a growing market for it, and it’s going to be pretty big over time,” Nvidia CEO Jensen Huang said in 2017.

PC gaming is also growing strongly. According to estimates by the NPD Group, consumer spending on PC gaming hardware increased 62% in 2020. Graphics cards are typically the most expensive part of a gaming PC.