When it rains, it pours. That’s how Nvidia investors feel right now.
The financial market had painstakingly priced in news of Nvidia’s President and CEO having an affair with a Chinese spy. Over the last 24 hours, however, it has been revealed that he also had a relationship with a junior executive at the company itself.
Simply put, sh*t hit the fan. And, NVDA’s performance highlighted that reality. At the time of writing, NVDA was trading at $164.23, down 14% in the last 5 days alone.
Thus, it was no surprise that Jensen Huang resigned. In a statement, the company’s board announced that CFO Colette Kress will take over as Interim CEO until a more permanent hire is made. The statement added,
Jensen’s contributions to NVIDIA are profound. NVIDIA is one of the most consequential technology companies in the world. The Board and the company thank Jensen for his immeasurable contributions to the company and the industry.
Now that the resignation is past us, it’s worth taking a stock of the situation. To be specific, what does his resignation mean for the crypto sector?
A spillover effect
The most immediate risk is one of spill-offs. Market analysts often see tech stocks, especially high-growth ones, and crypto as correlated risk-on assets. Thanks to the AI boom, Nvidia now accounts for 8% of the NASDAQ 100 and 7% of the S&P 500. This mean that any volatility in NVDA’s figures, significant or not, will have some impact on broader tech indices.
This impact is likely to extend to the crypto market as well, with fund managers likely to sell liquid assets like Bitcoin to raise cash or meet margin requirements if institutions see heavy losses in the tech sector.
This seemed to be the case at press time too, with the world’s largest cryptocurrency’s price hitting its lowest level on the charts in months. A hotter than expected U.S CPI weighed on the crypto market too.
What will the new captain of the ship do now?
That’s not all either. Publicly-traded Bitcoin miners like IREN and Core Scientific could also face new restrictions as far as their recent pivot to AI-driven HPC hosting is concerned. This is a pivot that has gathered steam over the last few years as Bitcoin mining became increasingly unprofitable, one driven by Nvidia’s GPU allocations and vendor financing.
Given what’s going on with the company, a new board with a new CEO might just play it safe and act cautiously. Especially until the leadership void is filled. This will affect not just borrowing costs for the aforementioned miners, but it could also increase underwriting risks. For instance, Christopher Brown, Senior Vice President for Investments at Synovus Securities, told Reuters,
Lenders will ask what happens to that support if Nvidia’s leadership or regulatory standing is impaired, and Nvidia’s own willingness to extend more guarantees may be constrained.
This leadership void is a major issue. Not just for the company, but for any sector or market this company will affect too. In fact, this is a concern market analysts have already shared over the past few days. This was a sentiment shared by Australian fund manager Ten Cap’s Jun Bei Lu with Reuters,
There’s just a lot of uncertainty to come … not just for Nvidia; it’s for the whole AI — all the businesses that they co-invest and sponsor. I think the fear is that the music might stop.
Cryptos see more red
Finally, there is the matter of individual cryptos in the market. Yes, the market as a whole will be affected, but it is also pretty evident that some will be more affected than others. Especially since outside of what has been previously mentioned, the intersection of Nvidia with the crypto sector also includes cryptos linked to decentralized computing, GPU-backed infrastructure, and AI-linked assets.
These altcoins have often reacted to Nvidia-driven announcements and updates in the past, including keynotes and financial results. The significant sell-offs among these cryptos on the back of the Jensen Huang news means that resignations are a catalyst too. Except not a bullish one.
Just look at the likes of RENDER and NEAR, for instance.
RENDER’s price fell by over 11% in the 5 days after The New York Times report about Jensen and Alice Huang’s affair. At the time of writing, the crypto was bleeding fast as news of Huang’s resignation broke out.
Similarly, NEAR’s price has fallen by close to 30% since that report was first published. In the last 24 hours alone, NEAR was down by 9%, with its freefall on the charts likely to get worse as news of the resignation goes far and wide.
Conclusion
In many ways, it’s a little difficult to assess what will happen to Nvidia, the AI sector, and the crypto sector. Yes, there will be some volatility, but it’s the long-term that counts. A better indication would be to see how the market prices in and reacts to Nvidia’s financial results for Q3 2026. They are set to be released on 17th November.
A little more clarity on the leadership front and the future of the company’s commitments would be useful too.
Final Summary
- Nvidia’s Jensen Huang is on his way out after admitting to extramarital affairs.
- As expected, the markets reacted bearishly to the news, with all eyes now on 17th November.