Seagate and Western Digital stocks are on fire as the new cryptocurrency Chia continues to propel a hard-drive shortage

• Seagate and Western Digital are the unlikely beneficiaries of a new cryptocurrency called Chia.
• The digital asset uses a technique called "proofs of space and time" to mint new coins on computer storage solutions.
• The result has been meteoric price increases for hard drives and solid-state drives around the world.

Shares of data storage manufacturers Seagate Technology and Western Digital have been soaring in recent weeks despite falling tech shares.

The rise comes amid a jump in demand for hard disk drives (HDDs) and solid-state drives (SSDs) from the companies after the launch of a new green cryptocurrency called Chia at the beginning of May.

Chia was founded by BitTorrent creator Bram Cohen and claims to offer a more eco-friendly option for investors than crypto leaders like Bitcoin or Ethereum.

Unlike Bitcoin, which is "mined" using "proof of work," Chia is "farmed" using a system called "proofs of space and time" to mint new coins.

The method is more energy-efficient, but it also requires a lot of hard disk or solid-state storage.

Tom's Hardware released an in-depth analysis detailing just how much prices for hard disk drives and solid-state drives have increased in recent weeks after the launch of Chia.

The company found that low-end hard drives and SSDs only moderately increased in price over the past few weeks while storage solutions with capacities over 10 terabytes saw their prices jump substantially.

The news follows data out of China from the South China Morning Post that showed a massive increase in spending on HDDs and SSDs at Chinese e-commerce retailers like JD.com, Alibaba, and Pinduoduo in anticipation of Chia's launch.

Not only does Chia require large amounts of storage to "farm," but according to reports out of PC Gamer, farming the cryptocurrency can burn out a 512GB SSD in just 40 days.

Chia's creator Bram Cohen took to Twitter to defend his cryptocurrency from what he called "fashionable FUD(fear, uncertainty, and doubt)" surrounding SSD burnouts after the PC Gamer article was released.

Cohen said plotting on hard drives and enterprise-class SSD's is no problem for Chia farmers, but warned no one should "plot on consumer SSDs" or they should "only do a little bit of plotting with each SSD."

In response to this new wave of demand for SSDs and hard drives-and the potentially short life-spans of these storage solutions if they are used to farm Chia-investors are flocking to the largest suppliers.

Seagate shares traded up as much as 8.25% on Monday, while Western Digital traded up as much as 7.75%.