Your ‘new’ Seagate data center hard drive is likely an used one

The cryptocurrency connection: how used HDDs entered the market

The affected hard drives reportedly stem from cryptocurrency mining farms, particularly those that mined Chia cryptocurrency. Unlike traditional cryptocurrency mining that relies on GPUs, Chia mining is storage-intensive, leading to a surge in HDD demand during its peak.

As Chia’s profitability declined, many mining operations shut down, offloading their heavily used HDDs into secondary markets. Some of these drives have had their internal usage logs reset to appear as new, deceiving customers, the report added.

The fraudulent sales first came to light in January when buyers began inspecting their newly purchased Seagate Exos data center-grade HDDs. SMART parameters, which track drive usage, had been reset to mask wear. However, deeper analysis using FARM (Field-Accessible Reliability Metrics) values exposed the true operational history of these drives.

More than 200 reports have surfaced globally, detailing instances where supposedly new Seagate Exos data center HDDs had been in operation for 15,000 to 50,000 hours. These drives have been sold via third-party marketplaces, including eBay, and have been reported in countries such as Germany, Switzerland, Austria, the UK, Japan, and the US, the report added.

A request for comment from Seagate on further actions remains unanswered.

Industry implications and next steps

The widespread nature of this fraudulent resale practice raises concerns about transparency in the secondary market. System integrators who resell HDDs may not always provide adequate warranties, leaving enterprise customers at risk.