Nvidia says ‘crypto adds nothing useful to society’ after billions in mining sales


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Nvidia’s Chief Know-how Officer, Michael Kagan, has expressed a negative view on cryptocurrencies, stating that they don’t “deliver something helpful for society,” whereas “AI does.”

Crypto isn’t ‘helpful for society’

In keeping with Kagan, AI functions such because the chatbot ChatGPT have extra worth than mining crypto. Kagan’s feedback aren’t too stunning provided that Nvidia has a historical past of distancing itself from the crypto group, resembling limiting the power of its graphics playing cards to mine Ethereum in 2021.

Kagan doubled down on his anti-crypto stance, stating that he has by no means believed in blockchain know-how.

“I by no means believed that [crypto] is one thing that may do one thing good for humanity.”

Nvidia’s current crypto previous

Nonetheless, Nvidia’s success within the inventory market over the previous two years does appear to have a correlation to the crypto trade. In 2021, previous to The Merge, Nvidia launched a graphics chip (CMP) that was optimized for Ethereum mining whereas limiting gaming-focused graphics playing cards. Nonetheless, the chips failed to impress as gross sales had been ‘nominal’ and collapsed 77% within the third quarter of 2022.

As well as, Nvidia was fined $5.5 million in Might 2022 by the SEC for failing to disclose the variety of GPUs bought for mining. The SEC alleged that Nvidia knew the playing cards had been getting used for mining however didn’t reveal the data, which, they mentioned, misled buyers relating to the expansion of the enterprise. Given that almost all of Nvidia playing cards had been used to mine Ethereum, which moved to proof-of-stake on the finish of 2022, it’s a honest criticism as demand for playing cards dissipated post-Merge.

Main as much as the Ethereum Merge, which came about on Sept. 15, 2022, revenue for Nvidia gaming GPUs (which largely nonetheless labored for crypto mining following community workarounds) fell to $1.57 billion, down from $3.2 billion the 12 months prior. Thus, as demand for Ethereum miners fell, so did Nvidia’s gross sales. In reality, in the event you have a look at the Nvidia share worth relative to the worth of Ethereum, each reached all-time highs inside every week of one another earlier than declining considerably.

nvidia eth
Supply: TradingView

Curiously, Nvidia’s CEO, Jensen Huang, additionally mentioned again in 2017 that “cryptocurrency and blockchain are right here to remain. The market want for it’s going to develop, and over time it’ll develop into fairly giant.”

It seems that now Ethereum has moved to proof-of-stake, and its CMP chips didn’t take off; the corporate has all however utterly turned its again on crypto, in keeping with Kagan’s statements. The corporate’s focus is on AI analysis and gaming, with main shoppers like Microsoft, Amazon, and Oracle buying over 36,000 of Nvidia’s AI-focused processors.

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