Nvidia was fined for hiding crypto profits

The US Securities and Exchange Commission (SEC) has fined Nvidia $ 5.5 million for failing to disclose to investors how much of its profits depended on crypto-miners.

Hardware manufacturer Nvidia in particular has stood out in recent quarters. The company, which is best known for its graphics cards, made a profit despite a severe shortage of chips, which meant that supply was significantly less than demand. However, part of the demand for graphics cards does not come from the target group of gamers, but from ‘cryptominers’, ie people who use the cards to extract digital cash by solving complex mathematical operations. And it is at this specific point that Nvidia should have communicated more clearly, according to the SEC, the US stock market controller.

The demand for graphics cards has indeed grown in recent years particularly strongly due to the crypto-mode, but it may have less positive consequences in the long run. Investors especially want to know how many cards have been bought by the right target group – the players – which represent a somewhat more stable market. Because the value of cryptocurrencies is quite volatile, giving rise to fears that this market will eventually dry out once the courage is over. According to the SEC, Nvidia did not report quickly enough to its shareholders that it had earned millions in profits because the market at the time was under the thumb of cryptocurrencies.

Nvidia itself has for some time been embarrassed about its status as a mining media provider. On the one hand, its products go like hot cakes, but on the other hand, it creates a market where players have to wait for years for an upgrade of their graphics card or compete for one. The company is trying to satisfy them in the meantime by slowing down the features needed for crypto-mining in part of its graphics card.

Hardware manufacturer Nvidia in particular has stood out in recent quarters. The company, which is best known for its graphics cards, made a profit despite a severe shortage of chips, which meant that supply was significantly less than demand. However, part of the demand for graphics cards does not come from the target group of gamers, but from ‘cryptominers’, ie people who use the cards to extract digital cash by solving complex mathematical operations. And it is precisely at this point that, according to the SEC, the US stock exchange controller, Nvidia should have communicated more clearly, which may have less positive consequences in the long run. Investors especially want to know how many cards have been bought by the right target group – the players – which represent a somewhat more stable market. Because the value of cryptocurrencies is quite volatile, giving rise to fears that this market will eventually dry out once the courage is over. According to the SEC, Nvidia did not report quickly enough to its shareholders that it had earned millions in profits because the market at the time was under the thumb of cryptocurrencies. Nvidia itself has for some time been embarrassed about its status as a mining media provider. On the one hand, its products go like hot cakes, but on the other hand, it creates a market where players have to wait for years for an upgrade of their graphics card or compete for one. The company is trying to satisfy them in the meantime by slowing down the features needed for crypto-mining in part of its graphics card.

Leave a Comment