Nvidia has made hundreds of millions of dollars by selling its processors to cryptocurrency miners. The stock slumped in response, after Bitcoin and Ethereum dropped more than 3% in 24 hours on Tuesday.
Nvidia shares fell 2.5% to $183.24 on Tuesday, after investors had a quarterly stock split on Monday. Nvidia shares fell sharply earlier in the day as they weren’t adjusted to take into account the extreme volatility of the crypto market.
But despite everything, Nvidia shares rose 74% year-on-year, while PHLX Semiconductor index, or Sox shares, rose 51%.
Nvidia processors were so popular with miners that video game players might use one or two, while miners used many more, and semiconductor processors designed a version specifically designed for mining. As additional information, it recently announced that they have restricted the mining functions of graphics cards.
Why is Nvidia stock falling?
Bitcoin’s plunge below $30,000 on Monday, and Ethereum in particular, may have frightened investors who believe high crypto prices will continue to boost Nvidia’s processor sales.
By noon on Tuesday, Ethereum was trading at $1,755.86, but last year when Ethereum price was in the $300 to $400 range, RBC Capital Markets analyst Mitch Steves announced that Nvidia’s RTX 3080 cards will be used as the best “weapon” for mining in the future, and it’s not unfair. .
Although the prices of the shares have fallen, Nvidia expects the crypto market to at least be stagnant before it can rebound. It is possible that sooner or later the stocks will recover.