US tech giant Nvidia has been slapped with a $5.5m fine by the US financial regulator for concealing the impact of crypto mining on revenue.
Nvidia did not tell investors that revenues for its gaming business were being boosted by the sale of graphics processing units (GPUs) to crypto miners in 2018, the US’ Securities and Exchange Commission (SEC) said in a statement yesterday.
The regulator claims that Nvidia investors therefore lacked crucial information about company performance – as the price of crypto assets rose GPUs were increasingly sought after for mining purposes linking gaming unit sales to volatile crypto markets.
“NVIDIA’s disclosure failures deprived investors of critical information to evaluate the company’s business in a key market,” said Kristina Littman, the chief of the SEC Enforcement Division’s Crypto Assets and Cyber Unit.
“All issuers, including those that pursue opportunities involving emerging technology, must ensure that their disclosures are timely, complete, and accurate,” Littman added.
In 2021 Nvidia rolled out a new product intended for Ether mining called a Cryptocurrency Mining Processor. It also added software to its graphics cards to prevent them from being used for crypto mining.
Nvidia did not admit or deny the SEC’s findings and agreed to a cease-and-desist order as well as the $5.5m penalty. Nvidia did not respond to City A.M.’s request for comment by press time.