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You can buy and sell cryptocurrencies 24/7, and something Senior Crypto Analyst Joe Shew shared last week really caught my attention — the connection between Nvidia Corp. (NVDA) and Bitcoin (BTC).
Nvidia helped with the new “renaissance” era of artificial intelligence (AI) with its $10,000 chip — the A100.
This chip allows things like AI image generators and chatbots to produce content —and the companies creating these generative AI models need hundreds or thousands of these chips.
But Nvidia’s products aren’t just for the AI industry.
Fast processing is Nvidia’s whole business. It was the original innovator of this category of chips (GPUs) in 1999, and it’s been the reigning champion ever since, having ramped up its computing power each year since then.
And Nvidia offers a dedicated line of chips specifically for crypto mining.
Meanwhile, as the Bitcoin market matures and gets much more competitive, Joe says that miners’ demand for the best GPUs will only increase.
And Joe also pointed out that when the Nvidia stock price takes off on a hot streak, the price of Bitcoin hasn’t been far behind.
In the chart below, you can see different instances where both have rallied and what is now happening with Nvidia and BTC:
Joe highlights how NVDA stock tends to lead the way for Bitcoin. Above you can see BTC is lagging the recent meteoric rise of the Nvidia stock price (so far) but is still moving higher through $30,000.
If this previous, little-known dynamic holds up, then we could very well see Bitcoin close that gap again.
Now, it’s true that cryptocurrencies can have volatile price swings, and for your own peace of mind, it’s important to know yourself as an investor and if you can handle that volatility.
But with crypto serving as a safe haven during the banking crisis, a potential Bitcoin ETF on the way, and a halving event not too far down the road that has historically led to the price of Bitcoin climbing, things are starting to get interesting in the crypto market.
Happy Independence Day.