Some digging by ExtremeTech suggests that a sharp increase in Litecoin mining is putting strain on the supply of AMD Radeon graphics hardware. Newegg and Amazon are both reporting no stock of the high-end cards, while low-level AMD chips are suddenly climbing the top seller charts.
The Litecoin network hash rate is climbing sharply as users look for alternatives to Bitcoin, which has become gradually less profitable when mined using GPU kit. Rather than being left dormant it would seem these gaming rigs are being used to mine Litecoin instead.
Like Bitcoin, Litecoin is a cryptocurrency, but there are some fundamental differences. It’s based on a different algorithm that has been specifically designed to be hard to parallelize, and more memory is required to process it. Litecoin transactions are confirmed more quickly (every 2.5 minutes rather than every 10) and there are more of them to go around — 84 million Litecoins will be available in total, compared with 21 million Bitcoins.
Litecoin is sometimes referred to as the silver to Bitcoin’s gold. While prices of both currencies tend to move together, it’s currently more cost-effective to mine Litecoin and covert to Bitcoin than it is to mine Bitcoin.
ExtremeTech has some useful advice for anyone thinking of getting started with mining digital coins: “If you want to make a bit of a play at earning a little scratch, go for it. Definitely go for it if you already own the hardware. If you think mining some coins could help defray the costs of buying a new GPU that you’re going to use anyway, then that’s probably a reasonable bet.”
“Bet” is the operative word though — it’s a highly volatile market surrounded by security and stability issues. For more, read our own Andrew Couts on why nobody in their right mind should get into Bitcoin at the moment.