NVIDIA Fined $5.5M for Vague Disclosures in Cryptomining: SEC

The Securities and Exchange Commission charged NVIDIA with inadequate exposure about the role of crypto mining in the company’s gaming business.

America’s greatest financial watchdog – the Securities and Exchange Commission – has settled with Nvidia over charges that the company under-reported the effect of crypto mining on its gaming business. NVIDIA agreed to pay $5.5 million as a punishment without accepting or denying the SEC’s findings.
Vague Disclosures
According to the SEC’s press release, the chip manufacturer giant failed to completely disclose information about crypto mining as an important source of revenue for its gaming business. Since the demand and interest in crypto grew in 2017, the company has been the main player in providing advanced GPUs to mining facilities.
The release states that NVIDIA included its income from GPU sales to crypto miners as part of its gaming business, but the company did not disclose that its “increase in gaming sales was driven in substantial part by crypto mining” in its Forms 10-Q, as required by SEC.
In addition, the authority has discovered that NVIDIA did not determine how the demand for crypto had impacted the other part of its business, which gave a belief that its gaming operations were not closely correlated with its involvement in mining. The Commission considers such deletions of crucial information have restricted investors from properly evaluating the company’s future performance.
Observing the Metaverse
Besides the years-long endeavors as a dominant chip manufacturer for Bitcoin mining facilities, NVIDIA is also watching the up-and-coming metaverse. Earlier this year, the company declared that it had launched a program to help artists and content creators who concentrate on building virtual worlds and products for the metaverse.
Meanwhile, the goliath said it would begin to distribute “Omniverse,” a software for making virtual worlds and metaverse-ready objects. Users can utilize it to develop exchangeable assets or worlds in third-party markets.