It’s been a bit of a drag to be a PC gamer over the last year or so. Cryptocurrency miners gobbled up all of the graphics cards in an already somewhat niche market, sending prices for high-end and even mid-range GPUs skyrocketing. That has changed.
Six months ago, we wrote about how this odd shift in the market made it more economical to buy a pre-made gaming PC than build one for the first time in…well, basically forever. The good news is that things are finally shifting. With the Bitcoin bubble officially bursting (and tech writers everywhere rejoicing that they don’t have to explain blockchain encryption anymore), the artificially high demand for powerful graphics cards has collapsed, and prices are returning to their normal near-MSRP levels.
The bad news is that if you want the best deal—as do-it-yourself system builders generally do—you’ll want to wait another couple of months to buy a new GPU or start that dream machine.
The numbers all point to Bitcoin and its sister altcoins bottoming out. From a high of nearly $20,000 per coin in January to just over $6000 now, cryptocurrency has lost two-thirds of its value as a commodity. A lot of people who jumped on the bandwagon at its highest point are now deep in the hole.
And don’t forget: the cumulative process of “mining” for new digital coins gets slower and more resource intensive as time goes on and more coins are “created,” irrespective of the market price of the coins themselves. In short, while cryptocurrencies are at a fraction of their former value, the cost of creating them when you factor in electricity and computer hardware is only going up. It doesn’t take a financial genius to see why investors are now avoiding the whole sector like a bad penny. NVIDIA said as much in a recent quarterly financial report.
You might think that graphics card suppliers NVIDIA and AMD and their manufacturing partners would be upset at this deflation of the cryptocurrency market, but that’s not the case. PC gamers make up a good portion of both companies’ sales, but there’s a much larger amount of money to be made selling components to PC manufacturers like Dell and console makers like Sony.
Consider that the PlayStation 4 and Xbox One both use AMD’s APU combined processor architecture, and the Nintendo Switch uses NVIDIA’s Tegra X1 mobile chip—that’s almost 100 million units between them for this generation alone. Consoles, laptops, and pre-built desktops are a reliable and mostly predictable source of profit. But to lower prices during the run on graphics cards for cryptocurrency mining, NVIDIA and AMD would have had to rapidly expand their production capabilities, far outpacing their standard output for sales to PC makers and gamers alike. That would have made them extremely vulnerable to the Bitcoin bust we’re now seeing—it’s a good thing both companies exercised a bit of foresight and caution.
The collapse of demand for graphics cards means benefits for gamers in multiple ways. Firstly and most obviously, the price of high-end GPUs is going down almost as fast as it rose late last year. Take NVIDIA’s GTX 1070 for example: generally, the company’s x70 cards are a pretty good investment for a PC gamer, with a premium price of around $400-450 justified by knowing that they’ll be able to play the latest games for several years. During the most prominent part of the Bitcoin boom, this MSI GTX 1070 topped out at a whopping $719 on Amazon, enough to buy a much more powerful GTX xx80 Ti during a more typical time in the hardware cycle. Now that same card is back down to its usual $400 retail price.
Next, there’s now a relatively sizable amount of cards in the secondhand market going for a song. You can now grab a GTX 970—powerful enough to handle most recent games at 1080p and 60FPS—for around $100-150 used. The same holds true for AMD’s previous top-of-the-line card, the RX 580.
You might be hesitant to buy a GPU that could have been part of a six-headed mining rig in a former life, but getting a secondhand card from a cryptocurrency miner isn’t as risky as you might think. As long as the fans are working and the firmware hasn’t been altered, it might even be in better shape than a typical discrete GPU. A frugal gamer can reap some huge savings.
And this drop in demand for high-end cards couldn’t have come at a better time. Next month NVIDIA will start shipping the first super-expensive cards in its long-awaited RTX series. With AMD pushing its next-gen RX Vega line, we’re going to see a classic punch-out between the two companies for the top end of the market. That means that demand and prices for the last generation of GeForce and Radeon cards should fall sharply at the end of this year, as NVIDIA and AMD release new models and adjust their MSRPs to try and undercut one another. Since PC games are in a bit of a holding pattern in terms of graphics tech since we’re in the middle of the current console generation, these older cards are still more than powerful enough to deliver great PC gaming performance.
Right now is a great time to build a new PC, with both Intel and AMD unlikely to introduce radical shifts to their CPU architecture soon and prices for SSD storage dropping like a rock. Inflated RAM prices due to a booming mobile memory market are a bit of a bummer, but that’s made up for by bargains to be had in other areas. GPU prices are steady, but if you can wait until the early adopters clear out the latest NVIDIA RTX cards, you’ll find some great deals in both the new and used markets at the tail end of 2018.