- Nvidia’s CTO has further distanced the company from crypto by slating digital assets as useless.
- The 2021 crypto price surge caused demand for Nvidia cards to skyrocket as miners snapped them up.
- Nvidia has never supported crypto mining and is now turning much of its attention to Artificial intelligence.
Emerging technologies’ growth and increasing popularity are often predicated on powerful hardware. Artificial intelligence (AI) and cryptocurrencies have relied on Graphics Processing Units (GPUs) to grow, but the former is garnering much more appreciation.
Michael Kagan, the Chief Technology Officer (CTO) of US chip-maker Nvidia, has criticized the use of crypto in society in an interview with the Guardian. He stated that the artificial intelligence chatbot ChatGPT was more worthwhile in processing power than mining crypto.
Nvidia has never been friendly to the mining ecosystem despite their association. Record highs for the top two most popular Proof-of-Work cryptocurrencies, Bitcoin and Ethereum, in 2021 played a role in that year’s massive graphics card shortages.
Crypto enthusiasts were seen to be buying up Nvidia cards to build crypto mining operations, with Nvidia even releasing software to curtail its card’s performance when mining Ethereum.
Nvidia was not interested in this new business but wanted to service its core audience, gamers and AI researchers. According to UBS analyst Timothy Arcuri, ChatGPT used 10,000 Nvidia GPUs to train the first version of the model.
Not Good for Society
Kagan explains why Nvidia was such a hit with crypto miners but also took a stab at the falling price of crypto and how that dented demand from the sector.
“All this crypto stuff, it needed parallel processing, and [Nvidia] is the best, so people just programmed it to use for this purpose. They bought a lot of stuff, and then eventually it collapsed, because it doesn’t bring anything useful for society. AI does,” Kagan told the Guardian.
The CTO explained why his company decided to protect itself against crypto rather than embrace it when the sector was buying up stock quicker than it could be produced.
“I never believed that [crypto] is something that will do something good for humanity. You know, people do crazy things, but they buy your stuff, you sell them stuff. But you don’t redirect the company to support whatever it is,” Kagan said.
Nvidia Riding the AI Wave
By contrast, Nvidia has thrown its weight behind supporting AI and has seen an 81% rise in its stock price year-to-date, boosting its market capitalization by $294 billion.
At the company’s annual conference on March 23, Jensen Huang, Nvidia’s CEO, described the company as the engine behind “the iPhone moment of AI.” Nvidia is considered the No. 1 producer of graphics chips needed for high-intensity AI computing and has signed major partnerships with Google, Microsoft, and Oracle.
On the Flipside
- Nvidia’s stock reached an all-time high of $329 just ten days after Bitcoin reached its all-time high of ~$69,000 in November 2021.
Why You Should Care
There is a lot of pressure on crypto mining, as it also faces criticisms from environmentalists who highlight the energy consumption required. However, it remains critical to the world’s most popular coin – Bitcoin – and this is unlikely to change.
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