Nvidia, the maker of GPUs for mining Ethereum, was fined $5.5 million

Nvidia, the maker of GPUs for mining Ethereum, was fined $5.5 million

Key facts:
  • Nvidia did not deny or admit the facts and decided to pay a USD 5.5 million fine to the SEC.

  • Nvidia spoke of revenue growth, but that was only from the gaming business.

For failing to properly report its earnings from mining Ethereum (ETH) and other cryptocurrencies, US technology company, graphics card (GPU) manufacturer, Nvidia, had to pay a $5.5 million fine to the Commission on United States Securities and Exchange (SEC).

According to the information released by the SEC, Nvidia Corporation, one of the world’s largest hardware manufacturers, made “inadequate disclosures” about the impact of cryptocurrency mining on its business.

In detail, Nvidia did not disclose that cryptocurrency mining turned into a “significant element” of its revenue growth, obtained as a result of the massive purchase of GPUsan electronic device used for gaming And, of course, mining.

According to the SEC, Nvidia violated Section 17(a)(2) and (3) of the Securities Act of 1933 and the disclosure provisions of the Securities Exchange Act of 1934. Therefore, and without admitting or denying, the company agreed to a cease and desist order, paying the amount mentioned above as a fine.

The opacity of Nvidia was experienced during three consecutive quarters of the year 2018, just when the demand and interest in cryptocurrencies began to grow and when Nvidia products were already used for mining these assets in networks such as Ethereum.

Nvidia, the maker of GPUs for mining Ethereum, was fined $5.5 million
The SEC fined Nvidia $5.5 million for not being truthful. Source: Anti-Money Laundering.

The fact is that in two of their forms for that year, Nvidia declared material growth in revenue, but they attributed it only to the video game business. This, even though Already they had information that the increase was largely due to cryptocurrency mining.

“Despite this, Nvidia failed to disclose on its forms, as it was required to do, these significant earnings and cash flow fluctuations related to a volatile business,” the SEC says.

The SEC also notes that Nvidia’s omissions “were misleading”The company did speak out about how other parts of the business were driven by demand in the crypto ecosystem, “creating the impression that the company’s gaming business was not significantly affected by cryptocurrency mining,” the information adds. .

For Kristina Littman, who is the head of the SEC Enforcement Division’s Crypto Assets and Cyber ​​Unit, Nvidia deprived investors of evaluating that company’s business in a key market. He recalled, in any case, that all issuers, including those seeking opportunities involving emerging technology, “They must ensure that their disclosures are timely, complete, and accurate.”

Nvidia, a hard mining

As reported in CriptoNoticias, Nvidia has emerged as one of the toughest companies for the manufacture of mining hardware, being one of the first options that operators take when investing in the business.

In the past, Nvidia had a fixed niche, gaming, where other industries also converged, such as design or graphic editing. But since the mining boom in 2016 and 2017, a new market was erected.

Nvidia, the maker of GPUs for mining Ethereum, was fined $5.5 million
Nvidia is one of the largest manufacturers of hardware used for cryptocurrency mining in the world. Source: Nvida/ wikipedia.org

In fact, the growth was so great that since last year Nvidia wanted to impose a hashrate restriction on its products, in an attempt to segregate its GPUs to the markets that bought the most from it.

In any case, Nvidia continues to lead the ranking among other competitors, such as Intel or AMD, launching new products, whose destinations can be a mining rig or a CPU gamerfor example.

See also  Bitcoin Lightning Network will allow issuing and exchanging stablecoins and other tokens

Leave a Comment

Your email address will not be published.