A hot potato: Nvidia’s history with cryptocurrency has been colorful, to say the least. The company has made billions of dollars thanks to the popularity of its graphics cards for cryptomining, but it said in a recent interview that crypto does not “bring anything useful for society.”

Speaking to The Guardian, Nvidia Chief Technology Officer Micheal Kagan said that the processing power of the company’s GPUs should be used for tasks more worthwhile than mining crypto, such as powering AI-based technologies like ChatGPT.

“All this crypto stuff, it needed parallel processing, and [Nvidia] is the best, so people just programmed it to use for this purpose. They bought a lot of stuff, and then eventually it collapsed, because it doesn’t bring anything useful for society. AI does,” Kagan told the Guardian.

“With ChatGPT, everybody can now create his own machine, his own program: you just tell it what to do, and it will. And if it doesn’t work the way you want it to, you tell it ‘I want something different’.”

Kagan compared cryptocurrency to high-frequency trading, an industry that brought a lot of business for Mellanox, the supplier of networking products that he co-founded and was acquired by Nvidia in 2020.

“We were heavily involved in algo trading: people on Wall Street were buying our stuff to save a few nanoseconds on the wire, the banks were doing crazy things like pulling the fibers under the Hudson taut to make them a little bit shorter, to save a few nanoseconds between their datacentre and the stock exchange,” he said.

“I never believed that [crypto] is something that will do something good for humanity. You know, people do crazy things, but they buy your stuff, you sell them stuff. But you don’t redirect the company to support whatever it is.”

It’s somewhat of a surprise to hear Nvidia’s CTO criticizing crypto in the style of Warren Buffett and Charlie Munger. So many Nvidia products were sold for mining that it caused the company’s share price to plummet following the 2018 crypto crash. But it turned out that Nvidia failed to disclose exactly how much of its revenue was coming from miners, leading to a $5.5 million SEC fine last year.

Allegations that team green reported $1 billion in crypto revenue as gaming revenue in 2017-2018 also led to a billion-dollar lawsuit against Nvidia, which was dismissed due to lack of evidence in 2021.

Nvidia tried to distance itself from crytpomining in 2021 when it launched Lite Hash Rate (LHR) versions of most of its RTX 3000 lineup, but it accidentally published a beta driver for the RTX 3060 that removed the limiter. The rest were bypassed within a year. This came during the last crypto-boom that, combined with the pandemic/chip shortage, resulted in graphics cards selling at two or even three times their MSRP.

Nvidia’s praise of ChatGPT is no surprise. OpenAI trained ChatGPT on a supercomputer Microsoft built from tens of thousands of Nvidia A100 GPUs. The Redmond giant announced a new array utilizing Nvidia’s newer H100 GPUs earlier this month.


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