Cryptocurrencies do not offer 'anything useful for society': Nvidia

The US chip-maker Nvidia, who has never shown strong enthusiasm for the Crypto community, believes that despite the company's powerful processors being sold in large quantities, cryptocurrencies do not offer "anything useful for society". 

According to Michael Kagan, its chief technology officer, the artificial intelligence chatbot ChatGPT plays more of a significant role than mining crypto, reports The Guardian.

In 2021, the company introduced a software that artificially constrained the ability to use its graphics cards from being used to mine the popular Ethereum cryptocurrency. These steps were specifically taken to ensure that supply went to its preferred customers instead, who include AI researchers and gamers.

Kagan explained that the decisions were made due to the limited value of using processing power to mine cryptocurrencies.

Reports show that the first version of ChatGPT was trained on a supercomputer which was made up of approximately 10,000 Nvidia graphics cards.

"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 to society. AI does," Kagan told the Guardian.

"With ChatGPT, everybody can now create his own machine, his own programme: 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'."

Crypto, by contrast, was more like high-frequency trading, an industry that had led to a lot of business for Mellanox, the company Kagan founded before it was acquired by Nvidia, adds The Gaurdian.

"We were heavily involved in also 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 fibres 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."

Nvidia, best known for producing powerful graphics cards for PC gamers to play the latest games, had luckily taken off during the peak of the AI boom.

Around two weeks ago, Microsoft revealed that it purchased tens of thousands of Nvidia's AI-focused processors, the A100 GPU, in order to power the workload of OpenAI.

Amazon had also bought  20,000 H100s for its cloud computing AWS service, and another 16,000 have been sold to Oracle.

With its DGX cloud service starting at just under $37,000 (£30,250) a month for just eight H100s wired together in a "cluster", Nvidia also rents access to their chips directly. 

Last week, Nvidia's chief executive Jensen Huang described the company as the engine behind "the iPhone moment of AI", and said the "generative AI" his firm powers would "reinvent nearly every industry" during their annual conference. 

In 2022, Nvidia's $40bn takeover of the UK-based tech firm Arm collapsed because of regulatory difficulties.