Nvidia will pay $5. 5 million from a settlement with the SEC that didn’t tell investors well how cryptocurrency miners were driving demand for their graphics cards.
Nvidia did not disclose how cryptocurrency mining drove the expansion at the time and in the third fiscal quarter of 2018, which took place in 2017, the SEC said in a filing.
The deal represents the end of a saga in which Nvidia, known for making graphics cards for gaming, ended up with a wonderful accumulation of profits from cryptocurrency miners who then refused to go through intangibles. Nvidia declined to comment.
Graphics cards, such as those from Nvidia, are suitable for mining Ethereum. In 2017, Ethereum prices rose from less than $10 to over $800, prompting miners to buy new devices to withdraw money.
Nvidia’s gaming category, which is how the company reports sales, grew 52% year-on-year in the last quarter of its fiscal year 2018 (which ended June 30, 2017) and 25% in the following quarter, but Nvidia failed. reveal the effect of cryptocurrency on this growth, according to the SEC.
Nvidia is aware that cryptocurrency mining drives part of its business, according to the SEC filing.
The company’s sales team in China at the time thought about the growing demand for gaming GPUs due to miners, and nvidia’s smarter control was sought to take over the crypto mining market, according to the SEC filing.
But cryptocurrency could have ended up being a distraction for Nvidia as demand for its graphics cards for its intended uses, gaming and artificial intelligence grew.
In 2021, Nvidia released new mining cards called the Cryptocurrency Mining Processor, and added software to its graphics cards to prevent them from being used for mining. the games prompted users to update their home gaming PCs.
However, CMP sales have declined dramatically since its introduction. In the last quarter, CMP revenue was just $24 million, to $266 million in the August 2021 quarter.
“Our GPUs are capable of mining cryptocurrencies, although we have limited visibility into the effect of this on our overall GPU demand,” Nvidia CFO Colette Kress said in a comment on the effects in February.
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