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Cryptocurrency miners bought 3 million graphics cards worth $776 million in 2017

The mining gold rush helped AMD grow its market share and lessen the gap between it and Nvidia.

Last year was a big one for cryptocurrency mining, and it culminated with a shortage of graphics cards and grossly inflated prices. According to a new report by Jon Peddie Research (JPR), miners purchased over 3 million add-in board (AIB) graphics cards worth around $776 million in 2017, with AMD emerging as the primary benefactor of those sales.

Those numbers are actually lower than we would have guessed them to be, though obviously still high enough to have a major impact on the market as a whole. If there's a silver lining for gamers, it's that gaming is the still the biggest market for GPUs.

"Gaming has been and will continue to be the primary driver for GPU sales, augmented by the demand from cryptocurrency miners," said Dr. Jon Peddie, President of Jon Peddie Research. "We expect demand to slacken from the miners as margins drop in response [to] increasing utilities costs and supply and demand forces that drive up AIB prices."

Assuming Dr. Peddie is correct in his analysis, what this means is that AMD and Nvidia have plenty of incentive to figure out a way to get more graphics cards into the marketplace, and specifically in the hands of gamers. Cryptocurrency miners might be an attractive audience now, but long-term, gamers are these companies' bread and butter (for graphics cards).

In the short-term, prices are likely to stay high, unfortunately. Dr. Peddie says "gamers can offset those costs by mining when not gaming, but prices will not drop in the near future." So that's a bit of a bummer.

Overall GPU shipments in the fourth quarter of 2017 actually decreased 1.5 percent from the previous quarter, though JPR chalked that up to normal seasonal activity. For the full year, shipments declined 4.8 percent.

AMD saw the biggest gains in market share, as it was able to jump by around 8.1 percent sequentially. Nvidia, meanwhile, saw a 6 percent decline in GPU market share.

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