Nvidia To Pay SEC $5.5M for Allegedly Failing to Disclose Crypto Revenue Boost

Nvidia misled investors when it failed to communicate crypto mining’s key role in its gaming business throughout 2018, according to the SEC


Source: Shutterstock


key takeaways

  • It’s one of the biggest penalties to date imposed by the SEC on a gaming company
  • The gaming giant did not admit or deny guilt as a condition of the settlement

Gaming giant Nvidia will pay the SEC $5.5 million for allegedly failing to properly disclose cryptocurrency mining’s impact on its revenue.

The SEC found Nvidia hadn’t communicated that cryptocurrency mining was a “significant element of its material revenue growth” throughout 2018.

The Santa Clara company’s processors were designed and marketed for gaming, but customers found they were also efficient at generating new cryptocurrency, particularly ethereum.

In particular, the SEC highlighted two Nvidia disclosures from 2018 which reported “material” revenue growth in its gaming business, even though Nvidia knew that growth was significantly driven by crypto mining.

“Despite this, NVIDIA did not disclose in its Forms 10-Q, as it was required to do, these significant earnings and cash flow fluctuations related to a volatile business for investors to ascertain the likelihood that past performance was indicative of future performance,” the SEC said in a press release.

Regulators considered the alleged omission misleading, as Nvidia had already disclosed the extent at which other parts of its business were boosted by crypto demand. The US securities watchdog said it created the impression that Nvidia’s gaming sector was not significantly affected by cryptocurrency mining.

Nvidia stock almost doubled between September 2017 and September 2018, a heady period for crypto markets powered by bitcoin’s first-ever surge to $20,000.

The company’s chipsets remain popular among miners, much to the dismay of gamers. Nvidia has even introduced so-called hash rate limiters on its newer models in a bid to curb high prices and low supply worldwide.

“NVIDIA’s disclosure failures deprived investors of critical information to evaluate the company’s business in a key market,” said Kristina Littman, who runs the SEC Enforcement Division’s Crypto Assets and Cyber Unit.

Nvidia settled without admitting or denying the allegations. The firm’s share price fell around 4% during intraday trading on Friday after news of the settlement broke.

Start your day with top crypto insights from David Canellis and Katherine Ross. Subscribe to the Empire newsletter.

The Lightspeed newsletter is all things Solana, in your inbox, every day. Subscribe to daily Solana news from Jack Kubinec and Jeff Albus.


Upcoming Events

Salt Lake City, UT

MON - TUES, OCT. 7 - 8, 2023

Blockworks and Bankless in collaboration with buidlbox are excited to announce the second installment of the Permissionless Hackathon – taking place October 7-8 in Salt Lake City, Utah. We’ve partnered with buidlbox to bring together the brightest minds in crypto for […]

Salt Lake City, UT

WED - FRI, OCTOBER 9 - 11, 2024

Pack your bags, anon — we’re heading west! Join us in the beautiful Salt Lake City for the third installment of Permissionless. Come for the alpha, stay for the fresh air. Permissionless III promises unforgettable panels, killer networking opportunities, and mountains […]

recent research

Research Report Cover Vertex.jpg


The proliferation of new perp DEXs has led to fragmented liquidity across various DEXs and chains. Vertex, known for its vertically-integrated DEX that includes spot, perpetual, and integrated money markets, is now tackling cross-chain liquidity fragmentation through horizontal integration with the launch of new Edge instances. Vertex's integrated offerings and cross-margined account structure amplify the benefits of new instances: native cross-chain spot trading, optimized cross-chain basis trading, consistent interest rates, reduced bridging friction, and more.


Plus, a dive into crypto’s ever-expanding unicorn club


Also, tokenization continues to grab headlines and one bitcoin miner stock soars Tuesday after inking a big deal


Fifteen million daily failed transactions disappeared from Solana


FTX debtors will pay the IRS $200M, with an outstanding lower priority claim of $685M


I’ve come to the realization that more attention is needed to create and sculpt the digital spaces where we live


The NYSE went down yesterday after a glitch caused a string of erroneous trades. Does DeFi fix this?