"In recent weeks the demand and pricing for high capacity [hard disk drives, or HDDs] has seen a material step higher ... and enterprise [solid state drive, or SSD] prices have also moved higher," analysts at Bank of America wrote in a Thursday report. The "primary upside driver" for that rising demand, according to BofA: chia.
These forces have all boosted the stock of Western Digital, a dominant seller of HDDs, as shares are up over 8% over the past couple weeks after seeing a big rally earlier this week. Wedbush analyst Matthew Bryson tells Fortune, "I certainly think that chia is a primary contributor to what's going on with ...Western Digital, particularly in the sense that the incremental demand on the hard drive side has created a shortfall in availability of high capacity drives."
Indeed, the Chia Network is using up more and more storage in recent weeks—presently, over 8 exabytes, an over 2,000% increase from April (see BofA's chart below). Analysts like Bryson are going to be watching "what happens with exabyte growth, which kind of tells you what demand has looked like. Right now it's been constantly increasing," he notes. Prices for some of Western Digital's products, meanwhile, have also been rising at a rapid clip within the past month, per BofA.