Sberbank apologizes for buying nearly all graphics cards on the Russian market

By Kevin Helms - November 12, 2017 (news.bitcoin.com)

Russia has been suffering from a shortage of graphics cards that can be used to mine cryptocurrencies, causing their prices to almost double. However, it was not ordinary households that purchased most of these cards. State-owned Sberbank has come forward, admitted to buying them, and apologized for causing the shortage.

Sberbank Apologized for Buying Up Graphics Cards

Sberbank, the largest bank in Russia and third largest in Europe, is majority-owned by the Russian government. According to senior vice president, Alexander Vedyakhin, the bank’s research lab was behind the dry spell. Ria Novosti reported on Saturday:

"The reason for the deficit in the video card market was Sberbank, buying up video cards for its laboratory of artificial intelligence".

Alexander Vedyakhin

“We invest very much in technology, and we should, incidentally, apologize for that shortage in the video card market, which occurred recently, because we bought them for the laboratory of artificial intelligence,” Vedyakhin said at the Sberbank international conference on data analysis, machine learning and artificial intelligence. However, he indicated that soon the shortage will be over “because we [have] satisfied our need.”

Is Sberbank Mining Cryptocurrency?

Stanislav Kuznetsov

While Sberbank has said that it is “not yet ready” to use cryptocurrency, the bank admitted to studying it in detail, according to Stanislav Kuznetsov, Deputy Chairman of the Executive Board of Sberbank.

“Sberbank does not intend to use cryptocurrency in business yet, but is studying them to protect itself from scammers,” Tass reported and quoted Kuznetsov saying last month at the World Festival of Youth and Students in Sochi:

"We are not afraid of cryptocurrencies, but in order to defend ourselves, we must understand in detail how scammers operate, we must study each step…Today we are deeply studying this topic, but, unfortunately, there are no solutions yet, how to proceed further, and we are not yet ready to use the cryptocurrency".

Shortage of Graphics Cards in Russia

The Chinese online trading platform Aliexpress, an Ebay-like subsidiary of Alibaba, reported in June that there was a surge in demand for video cards in Russia for cryptocurrency mining. “Aliexpress associated a surge of interest in video cards with the desire to use them to generate cryptocurrency,” the publication emphasized, adding that:

"The trading platform reported that its users began to look more actively for specific models of video cards that are most suitable for creating crypto-farms (GeForce GTX1060, GTX1070 and Radeon RX480), and the number of bitcoin miner requests increased 150% in a month".

Prior to Sberbank’s confession, RT reported that “the recent surge in the value of bitcoin has caused a jump in demand for video cards, which are used in cryptocurrency mining.” In addition, “people buy up to 600 video cards at once,” the publication detailed, noting that this has caused “a nearly 80 percent price surge since the spring.”

According to Vedomosti, the spike in demand has caused the price of graphics cards to rise “by an average of twice: for example, a device that cost in spring 16,000-18,000 rubles now costs more than 30,000.” The news outlet added that one store promised that the cards can be ordered within a week while another said it would take 10 days.

Images courtesy of Shutterstock and Sberbank.

Kevin Helms

A student of Austrian Economics, Kevin found Bitcoin in 2011 and has been an evangelist ever since. His interests lie in bitcoin security, open-source systems, network effects and the intersection between economics and cryptography.