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Nvidia Fined By SEC for Omitting Important Crypto Information

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VOC, Crypto, Nvidia

Nvidia, the multinational specializing in the development of graphics cards, GPUs, and computer technology, will pay a millionaire fine to US regulators for providing “inadequate disclosures” about the relationship of its business with crypto mining.

The United States Securities and Exchange Commission (SEC) accused Nvidia of failing to adequately disclose the impact of cryptocurrency mining on the company’s revenue. According to the regulator, the manufacturer failed to mention that its gaming business had benefited from the popularity of cryptocurrencies in two filings in 2018.

SEC charges Nvidia 

In a statement released Friday, the federal agency said the company had not indicated that crypto mining was “a significant element of its material revenue growth” based on sales of its graphics processing units, or GPUs, during the fiscal year. 2018. The SEC report reads:

[…]NVIDIA had information that this increase in game sales was mainly due to crypto mining. Despite this, NVIDIA failed to disclose on its Forms 10-Q, as it was required to do, these significant earnings and cash flow fluctuations related to a volatile business[…].

“NVIDIA’s disclosure failures deprived investors of information critical to evaluating the company’s business in a key market,” added Kristina Littman, Chief of the SEC’s Division of Enforcement’s Cyber ​​and Cyber ​​Assets Unit. “All issuers, including those seeking emerging technology opportunities, must ensure that their disclosures are timely, complete, and accurate .” 

According to the report, Nvidia has reached an agreement with the SEC for a cease and desist order and the payment of a $5.5 million fine to resolve the allegations.

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Did you omit information due to ignorance?

Nvidia began mentioning crypto mining and its impact on its equipment manufacturing business in 2017. The outlet cited a July 2017 presentation from the company that its revenue from equipment sales grew by 200%. % “mainly due to strong demand for GPU products aimed at cryptocurrency mining .”

However, at the time, the company seemed to overlook the equally positive impact its gaming business was having due to the rise of Bitcoin. According to that medium, the Nvidia GeForce GTX 580 graphics cards, marketed for video games and mainly among gamers, became very popular in 2018 among crypto miners.

Despite that, Nvidia CEO Jensen Huang claimed that it was impossible to know how much of his hardware was being used by miners. “There is no way for us to calculate that,” he told VentureBeat in November 2018, speaking about the impact of Bitcoin on his business. For that date, Nvidia reported millionaire losses after the collapse of prices in the cryptocurrency market.

The report notes that in a quarterly report filed on May 18, 2018, for the three months ending April 29 of that year, Nvidia attributed the rise in gaming revenue to eSports.

The most recent data shows Nvidia’s cryptocurrency mining processors (CMP) revenue fell to $24 million in its fiscal fourth quarter, which ended on January 30. This is a 77% decrease from $105 million in the previous quarter, CoinDesk said, citing a company presentation.

 

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Adekunle Joshua is a cryptocurrency writer. He has a deep understanding of the technology and how it can be used to improve the world. James is a strong advocate for using cryptocurrency to make the world a better place. He wants to help people understand the technology and use it to improve their lives.

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