A newly-popular cryptocurrency has been blamed for disrupting global supply chains of solid-state drives or SSDs.
The Chia network, with its Chia token, was founded as an eco-friendly alternative to Bitcoin’s energy-intensive proof-of-work mining algorithm.
Instead, Chia uses what it calls proof of space and time, using empty computer storage to store ‘plots’, or files that are later ‘harvested’ as part of the ‘farming’ process when verifying transactions to add to the Chia blockchain.
“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’. 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,”
But as with anything that gains popularity, there have been unintended consequences. Since SSDs are faster than regular spinning-disk hard disk drives (like those typically found in desktops), farmers of Chia coins use setups with a lot of inexpensive SSDs. However,
…plotting Chia uses loads of writes, so a cheap 512GB SSD can be trashed in 40 days… a higher capacity drive featuring a similar DWPD rating would have lasted longer, for about 160 days.
from Tom’s Hardware.
In fact, so many hard drives have been used and trashed that demand for them has gone up. From a Barron’s article in May:
… more than 8 exabytes of storage had been allocated to the Chia network, an increase of more than 2,000% in a month… The extra demand is spurring price increases, too: Mohan notes that the price of 14-terabyte drives on Amazon has increased between 73% and 75% in recent weeks, with 16 TB drives up between 53% and 61%
and, as the article notes, that’s been pushing the stock of hard drive manufacturers up. This is the one year trend for Seagate and Western Digital:
Finally, ironically, none of this has had much of an effect on the price of the Chia token at all:
This is one case where you’re better off investing in the ecosystem of companies around the token than the token itself!