US technology company Nvidia will pay $5.5 million to settle charges that it did not properly disclose the impact of cryptocurrency mining on its gaming business, the US Securities and Exchange Commission (SEC) said.
Nvidia failed to disclose that crypto-mining was a “significant element” of its revenue growth, the agency said.
The SEC said that the settlement related to sales of chips designed for gaming during two quarters in fiscal 2018.
Nvidia, which did not admit or deny the SEC’s findings, agreed to pay the civil penalty. A spokesperson for Santa Clara, California-based Nvidia declined to comment.
In 2018, Nvidia’s chips became popular for their use in crypto-mining, the process of obtaining crypto rewards in exchange for verifying transactions on distributed ledgers, the SEC said.
The regulator alleged that Nvidia knew that information, but failed to share it with investors.
Those omissions misled investors and analysts who were interested in understanding the impact of cryptomining on Nvidia’s business, the SEC said.
In 2021, Nvidia said it was deliberately making some of its products less useful to cryptocurrency miners.
The company said at the time it would limit the capabilities of its most popular video gaming cards to make them less adept at performing the calculations needed to validate transactions on the ethereum network.
- Reuters, with additional editing by George Russell