AMD’s Epyc Chip Drives Stock Higher – Cryptocurrency Potential Examined

06/21/2017

AMD is surprisingly up from a low of about $2 in 2015. CNBC and Barron’s report that AMD stock is surging on news that the new Epyc processor will compete with Intel’s Xeon for datacenter technologies. If cryptocurrency miners are scarfing up AMD graphics cards now due to the wonderful performance-to-price ratio provided I can imagine further growth in this stock.

Let’s face it AMD is making a comeback. The stock is $13.52 in pre-market trading, that is up $0.88 as of writing just 20 minutes before the opening bell 6/21/2016. This has more to do with the release of the Epyc processor competing in datacenters with Xeon but we also know how much the cryptocurrency community appreciates GPU’s for mining new algorithms for which no ASICs are taped out yet.

CNBC erroneously refers to demand among Bitcoin miners for AMD technology but as we all know Bitcoin uses SHA-256 so unless AMD starts manufacturing SHA-256 ASIC chips this is related to algorithms that secure coins which are difficult to apply FPGA or ASIC technology to.

Alternatively, GPU’s are applied to algorithms right after CPU’s start to become less profitable (in a traditional proof-of-work crypto the life-cycle is CPU-> GPU-> FPGA-> ASIC). So GPU’s are deployed frequently in cryptocurrency mining since it is often the technology with the best I/O and memory bandwidth (memory bandwidth can be key and Epyc supposedly has ~120% better through-put for memory). GPU’s will likely continue to be used in specific algorithms or virtually all new algorithms until the difficulty precludes profit. GPU’s are the step between CPU and FPGA/ASIC technologies.

The graphics card is readily available, provides large amounts of fast memory and I/O. You want massively parallel computing for successful mining and the first off the shelf technology that can be deployed quickly to mine better than a CPU is of course the GPU.

AMD should also consider designing, building, and selling various ASIC chips for mining currencies which use various proof-of-work algorithms. As CNBC pointed out investing in AMD is a great way to indirectly invest in the explosive popularity of the cryptocurrency as an alternative to government-issued government-controlled currencies.

I was looking at AMD before this for different reasons but this use of GPU’s to mine, while well known to me, did not really occur to me as a growth driver of the AMD brand but now I’m looking more seriously at chip manufacturers that may benefit from the explosive growth in the cryptocurrency industry.

 

UPDATE 7/3/2017

Quite predictably AMD has fluctuated since this post but further rumors are that NVIDIA wishes to compete in this sector too! Make of this all what you will. It seems a logical place to take their parallel computing design prowess.

Beyond this mining cryptocurrency with Intel data-center technology appears to enjoy great popularity as search metrics for mining with Xeon data-centers is quite voluminous at the moment. Three companies to watch in the cryptocurrency industry and elsewhere in the overall chip-o-sphere.

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