Nvidia Faces Class Action Lawsuit Over Its Statements on Crypto Mining Influence Its Business

The California-based developer of high-end GPUs Nvidia has recently been hit with a class action lawsuit over its statements on the influencing cryptocurrency mining had on its business this year.

Schall Law, a US-based shareholder rights litigation firm, has announced the filing of the class action lawsuit, as according to them Nvidia violated the Securities Exchange Act of 1934. The firm is currently asking investors who lost over $100,000 after investing in Nvidia’s stock between August 10, 2017 and November 15 of this year, to contact them before February 19 of next year.

Per the complaint, Nvidia “made false and misleading statements to the market.” The document explains:

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.

Taking this into account, it adds, Nvidia’s statements “were false and materially misleading throughout the class period.” When the market “learned the truth,” it concludes, investors suffered losses.

As CryptoGlobe covered, Nvidia’s stock has been plummeting this year over a significant decline in demand for GPUs from cryptocurrency miners. The decline in demand led to a significantly lower amount of sales, which saw Nvidia miss its Q3 $3.24 billion revenue expectation, as it stayed at $3.18 billion.

Reacting to Nvidia’s results, investors sold the stock, which saw its price plummet. At press time, according to Yahoo Finance data, they’re at $133.6, after falling from a $286 high.

Nvidia's price performance YTD

The decline in cryptocurrency miner-related GPU demand can be attributed to the cryptocurrency ecosystem’s year-long bear market, which has seen the price of most top cryptocurrencies drop between 80% and 90%. This has made it unprofitable for some miners, which subsequently saw the hashrate of various cryptos plummet, including that of bitcoin.

The crypto market’s decline has also affected Nvidia’s competition. As covered, AMD has revealed in July it was expecting “near zero” revenue from GPU sales to cryptocurrency miners.

Hash Wars: Mining Operation OrcaPool Launches to Defend Altcoins and Forks From ‘Attackers’

A new mining operation dubbed “OrcaPool” has recently been launched, with the goal of defending altcoins and forked coins from attackers who may attempt to pull 51% attacks on them. Specifically, the pool appears to be a response to SharkPool.

At the time of Bitcoin Cash’s hard fork last year, a new cryptocurrency mining pool, SharkPool, was launched. The pool, founded by Bitcoin Satoshi’s Vision (BSV) supporter Ari Kuqi, threatened to annihilate “alts who dare bearing the Bitcoin name,” and specifically named Bitcoin Gold, Bitcoin Diamond, and Bitcoin Private.

SharkPool’s plan to annihilate cryptocurrencies is to dominate their hashrate to then start mining empty blocks on their chains. This stops transactions from going through, which over a long period of time creates a significant transaction backlog, making their network useless. The second part sees it sell the rewards it gets from those blocks for BSV, pushing its price up and putting selling pressure on the attacked crypto.

So far, SharkPool has seemingly attacked BCH’s testnet forcing it to add additional security resources, and Bitcoin Private’s (BTCP) mainnet, forcing cryptocurrency exchanges to require 1,500 network confirmations on transactions.

Speaking to CryptoGlobe, Kuqi revealed that behind SharkPool’s ideology is Nakamoto Consensus. Per his words, nothing the pool does is “illegal,” as it “obeys all laws and regulations.” He added “miners execute their executive power by voting with their hash, building on a block or orphaning it.”

At the time Kuqi, the founder of Cashpay Solutions, also noted it doesn’t matter whether Craig Wright is indeed Satoshi Nakamoto, as SharkPool “fights for sound and stable money.” The pool has over the past few months been recruiting miners.

Now OrcaPool, on Twitter, has revealed its goal is to counter SharkPool’s activities, and that it’s also recruiting miners to join its resources. Its website explains the Orca was chosen as it’s a natural predator of the shark.

The new pool is reportedly going to sell the rewards of blocks it mines for bitcoin. So far, the war between the two pools has seemingly only been occurring on social media. SharkPool, reacting to the competitor, stated:

As onlookers piled on, OrcaPool pushed back: