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Nvidia fined $5.5 million for downplaying crypto GPU business

The United States Securities and Exchange Commision served the fine to the GeForce graphics card manufacturer based on findings from its 2018 fiscal year

The Nvidia logo, made up of small green rectangles against a gunmetal grey background

Nvidia has received a fine of $5.5 million from the U.S. Securities and Exchange Commission (SEC), for failing to disclose the impact of crypto mining on the sale of its GeForce GPUs. The company has neither admitted nor denied the charges, and has agreed to a cease-and-desist order in addition to paying the penalty in full.

While it’s no secret that demand from crypto miners has contributed to the limited availability of the best graphics cards from Nvidia in recent years, this charge stems the company’s revenue during the 2018 fiscal year. Throughout that time, the SEC says “Nvidia customers increasingly used its gaming GPUs for cryptomining,” following higher demand and interest from consumers in cryptocurrency.

The SEC asserts that Nvidia “deprived investors of critical information to evaluate the company’s business in a key market”, due to the company “creating the impression that its gaming business was not significantly affected by cryptomining.” As a result, the company has been found to be in violation of the Securities Act of 1993 and the disclosure provisions of the Securities Exchange Act of 1934.

A fine of $5.5 million may seem large at first, but considering that Nvidia generates billions of dollars of revenue each passing financial quarter, it’s safe to say the company’s finances will be largely unfazed by this.

However, it remains unclear how the SEC’s findings will (if at all) affect the company’s relationship with shareholders and conversely the prices of its shares.