Nvidia, a 3.25 trillion-dollar company and the world’s largest GPU manufacturer, is facing a new development in the world of cryptocurrency. The U.S. Supreme Court has agreed to hear a case related to Nvidia’s revenue from crypto mining, which could impact shareholder lawsuits against the company.
The case revolves around allegations that Nvidia misled shareholders about its reliance on crypto mining revenue before the 2018 market crash. Nvidia is seeking to dismiss the lawsuit, arguing that it lacks sufficient detail to proceed. A ruling in Nvidia’s favor could set a precedent for companies to seek early dismissal of shareholder lawsuits under the Private Securities Litigation Reform Act of 1995.
This development comes at a critical time for shareholder litigation, with the Supreme Court also considering a case against Meta Platforms over the Cambridge Analytica data harvesting scandal. Shareholders claim that Nvidia’s CEO concealed the fact that the company’s revenue growth was driven by mining-related activities rather than gaming sales, leading to a sharp drop in share prices in 2018.
Despite agreeing to pay $5.5 million to resolve related allegations by the SEC in 2020, Nvidia continues to face legal challenges related to its cryptocurrency involvement. Investors argue that the company’s exposure to the volatile crypto market was not properly disclosed, leading to significant losses for shareholders.
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