NVIDIA Slapped With Class Action Lawsuit Tied To Cryptocurrency Implosion

A law firm in Los Angeles, California is encouraging investors who lost in excess of $100,000 by pouring money into NVIDIA’s stock to contact the agency for participation in a possible class-action lawsuit. It’s the position of the complaint that NVIDIA mislead shareholders by overstating its ability to weather the crumbling of the cryptocurrency market, as it pertains to mining with GPUs.

“[NVIDIA] made false and misleading statements to the market. NVIDIA touted its ability to monitor the cryptocurrency market and make rapid changes to its business as necessary. The Company claimed to be ‘masters at managing our channel, and we understand the channel very well’. NVIDIA also claimed to the market that any drop off in demand for its GPUs amongst cryptocurrency miners would not negatively impact the Company’s business because of strong demand for GPUs from the gaming market,” the complaint states.

“Based on these facts, the Company’s public statements were false and materially misleading throughout the class period. When the market learned the truth about NVIDIA, investors suffered damages,” the complaint continues.

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As many of you reading this might already be aware, cryptocurrency mining bolstered the demand for GPUs for much of last year. Both AMD and NVIDIA benefited from this to some extent. Even though gamers ultimately suffered for a period of time due to a shortage of graphics cards and inflated prices, the lawsuit doesn’t take issue with this.
What the potential class-action suit does take issue with is the steep decline in NVIDIA’s share price after the cryptocurrency bubble burst. For the most part, it stopped becoming profitable to mine cryptocurrencies like Ethereum using GPUs towards the end of 2018.

Whether entirely related or not, NVIDIA’s share price has seen a precipitous drop over the past few months. The company is currently trading at $133.50, which is down from over $200 in mid-November, and much lower than its high of nearly $300…

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