Over the past year, the cryptocurrency boom has crippled the PC hardware market. Not only is it incredibly difficult to bag yourself one of the new GPUs, but the prices have also skyrocketed significantly. This is not solely due to crypto miners, as the global chip shortage is a big culprit as well, but it looks like SSDs and HDDs could be the next victims of the cryptocurrency boom.
A new cryptocurrency called Chia has been revealed from the creator of Bittorrent, Bram Cohen. It’s described as a “better blockchain and smart transaction platform which is more decentralized, more efficient, and more secure.” However, the main difference between it and other cryptocurrencies is that it leverages the unused storage space on drives as opposed to the raw computational power of graphics cards and processors etc.
That latter process is known as ‘proof of work’, which is what other popular cryptocurrencies like Bitcoin use. Instead, Chia’s process is called ‘proof of space and time’:
“Proof of space can be thought of as a way to prove that you are keeping some storage unused on your hard-disk drive. Users of the Chia blockchain will 'seed' unused space on their hard-disk drive by installing software which stores a collection of cryptographic numbers on the disk into 'plots'. These users are called 'farmers',” says the official Chia FAQ.
“When the blockchain broadcasts a challenge for the next block, farmers can scan their plots to see if they have the hash that is closest to the challenge. A farmer’s probability of winning a block is the percentage of the total space that a farmer has compared to the entire network.” The Proof of Time bit essentially just requires “a small period of time to pass between blocks.”
How exactly this will impact the PC hardware market is still unclear, as Chia will be officially launching on May 3rd 2021. However, there have already been reports of SSD and HDD prices rising in China by up to 67%. So hardware manufacturers in China may already be expecting demand to increase.
Additionally, digital storage provider Seagate recently held a call with investors, where the company admitted they have seen an “uptick in demand” thanks to more and more hard drives being used by crypto miners.
There’s also reports of some agents who are stockpiling drives to create artificial demand (the pipeline of storage devices in China goes: manufacturer > agent > distributor > retailer), though it is said to only be a small percentage of agents.
Either way, the anticipation for a new cryptocurrency leveraging storage devices like HDDs and SSDs looks to be having some sort of impact on supply and prices in China. If Chia does pick up then, there is a chance storage drives will be harder to come by and even increase in price. So you can now add another reason why gamers shouldn’t upgrade their PC in 2021. And if you’re looking to buy a new drive anytime soon, now might be the best time before Chia properly kicks off.
What do you think? Do you buy storage devices often? Do you use mostly HDDs or SSDs? Are you looking to get one soon? And do you think Chia will actually affect the supply and price of storage devices? Let us know your thoughts!