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The only way that hardware is conceivably getting "too powerful" is in terms of TDP, which results in bigger and bigger hardware. Consoles have kept getting bigger (just compare a PSOne with a PS5 for size), and PC parts, especially GPUs, are getting too big for some cases; while you need water cooling to get the most out of CPUs, especially those from Intel right now.

Neither is a problem for software development, so it's not a problem for game developers.