Breaking News
Investing Pro 0
Cyber Monday SALE: Up to 54% OFF InvestingPro+ CLAIM OFFER

Nvidia Fined $5.5M for Hiding Cryptomining Revenue in 2018

Cryptocurrency May 09, 2022 06:31AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
Nvidia Fined $5.5M for Hiding Cryptomining Revenue in 2018
 
NVDA
-1.51%
Add to/Remove from Watchlist
Add to Watchlist
Add Position

Position added successfully to:

Please name your holdings portfolio
 

The Nvidia (NASDAQ:NVDA) Corporation has agreed to pay a penalty of $5.5M for not properly disclosing its revenue from cryptocurrency mining in 2018. The American tech hardware corp received a civil charge for violating the Securities Exchange Act and misleading investors during the 2017-2018 cryptocurrency boom.

Nvidia failed to disclose “that cryptomining was a significant element of its material revenue growth from the sale of its graphics processing units (GPUs) designed and marketed for gaming”, the recent Securities and Exchange Commission (SEC) order stated.

Gaming GPUs Were Used to Mine Crypto

2017 witnessed the unprecedented growth of the crypto market, as the prices of digital coins soared to historic highs. The resulting boom of the cryptocurrency mining industry created excessive demand for high-end GPUs, eventually leading to shortages.

At the time, GPUs were one of the most effective tools for mining digital coins. Their prices reached extreme new highs, and led to Nvidia’s market value almost tripling during the crypto-mining boom. As Bitcoin’s price crashed in 2018, GPU demand slumped accordingly, leading to a decrease in Nvidia’s revenue in the final quarter of 2018.

In consecutive quarters of Nvidia’s 2018 fiscal year, the company reported growth in revenue of its gaming hardware. As later reported by the SEC, Nvidia was aware that the increase in gaming GPU sales was largely caused by cryptocurrency mining hype. Despite this fact, Nvidia failed to disclose these significant earnings, which were associated with the volatile industry, to its customers, as it was required to do.

Investors accused Nvidia of falsely reporting that the demand for GPU came from gamers, not cryptocurrency miners. According to them, Nvidia claimed that the reduced demand from crypto miners would not negatively impact its business. As a result, the decline witnessed in Nvidia’s revenue and stocks in 2018 led investors to record losses, who later launched a class-action lawsuit against the company.

According to the current SEC order, Nvidia misled customers by providing information about its growing gaming business, without also disclosing the fact that other aspects of the company’s business were being driven by demand for digital currencies. Nvidia therefore created the impression “that the company’s gaming business was not significantly affected by cryptomining.”

Nvidia has reportedly agreed to a “cease-and-desist” order, and will pay a $5.5 million fine. The SEC has not provided any further details on the terms by when the penalties will be carried out.

Continue reading on DailyCoin

Nvidia Fined $5.5M for Hiding Cryptomining Revenue in 2018
 

Related Articles

How low can the Bitcoin price go?
How low can the Bitcoin price go? By Cointelegraph - Nov 27, 2022 1

Bitcoin (BTC) has spent over a year in a downtrend since its $69,000 all-time highs in November 2021. BTC price performance has given investors up to 77% losses, but how much lower...

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
Comments (1)
Great Jambino
Great_Jambino May 09, 2022 7:17AM ET
Saved. See Saved Items.
This comment has already been saved in your Saved Items
Wow, $5.5M is really going to break the bank for them...
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email