NVIDIA Corporation (NASDAQ:NVDA) investors are likely to benefit from the rising cryptocurrencies such as Ethereum according to RBC analysts who reiterate an outperform rating on the market shares as the prices keep rising each day. According to RBC Capital’s Mitch Steves, the payback period for the crypto-currencies has drastically dropped (from 9.4% to 5.6%) materially with the increase in the digital currency prices such as Bitcoin, Ethereum, Monero, and zCash in the last few weeks.
A sharp rise for the cryptocurrencies such as the Ethereum has brought down the time gap between the mining period of the currencies and the time it takes to get paid, which should maintain the demand for Nvidia graphics cards that miners are using. Nvidia and Advanced Micro Devices Corp (AMD) have significantly received a boost this year from the cryptocurrency mining sales that normally use the graphics processing units to help create the crypto coins.
Nvidia’s stock has doubled this year and shares are up with 0.2% due to a notable higher shift in the cryptocurrency prices. According to the market analysts, the upsurge in the prices of the digital currencies is partly because of the institutional money that is being channeled into the cryptocurrencies. The market analysts believe that many investors are beginning to appreciate the value of the cryptocurrencies.
The cryptocurrency industry is growing rapidly as more and more institutional money and high net worth investors rush into the rapidly growing space. For instance, the bitcoin lightning network has significantly made progress and the software development team is still working on the digital signatures to enhance the confidentiality of transactions. Ethereum is currently perceived as the most secure way of transacting money.
Generally, the growth of the technology is developing at a rapid rate together with the institutional interest which is likely to boost the prices of the cryptocurrencies. However, many industry analysts warn that the future of the digital currencies is uncertain and it’s difficult to know whether the surge in prices will be sustainable. Therefore, investors are advised to keep track of all the cryptocurrencies.