Nvidia perpetual futures on Binance fell more than 8% from the U.S. close late Wednesday after reports emerged that the chipmaker’s board was considering expelling CEO Jensen Huang.
Although the board’s decision has not yet been confirmed, traders had their first chance to react to the news via crypto platforms since its release; The Nasdaq was already closed.
Traders weigh up Jensen Huang’s potential exit
According to reports from the New York Times and Bloomberg, Nvidia’s board is preparing to withdraw Huang from his position and has even hired an external firm to identify possible replacements and is also considering appointing an interim CEO.
This was caused by revelations that Huang had had at least two extramarital affairs, one with someone working at the company and another with an alleged Chinese spy, Alice Huang. Nvidia’s co-founder sent an email to company employees on Sunday apologizing for his conduct, with the board launching an independent investigation into the matter.
Moreover, as CryptoPotato According to reports, a shareholder, Mark Kistenmacher, also filed a lawsuit, claiming that Nvidia and Huang misled investors about the latter’s relationship with the alleged Chinese agent, who is a former executive at Megaspeed International, a company that allegedly purchased more than $4.8 billion worth of Nvidia chips over the past two years.
According to Binance Research, when reports emerged that Nvidia’s board was planning to get rid of Huang, they triggered an immediate revaluation on its NVDAUSDT perpetual futures market, well after the close of US equities.
Nvidia had ended this session at around $173.73, which was actually an improvement of almost 3% from the start of the day. However, after the management announcement, the contract on Binance fell around 8.8% lower, reaching an index level of 92.6 while the previous close was set at 100.
There was also a lot of trading activity, with NVDAUSDT seeing $2 billion in 24-hour volume. According to Binance’s report, about half of that came after the end of the U.S. spot session, suggesting that traders were actively reacting to the reports rather than waiting for Nvidia shares to resume regular trading today.
Analysts say Nvidia should not fire Huang
Not everyone thinks removing Huang is a good idea. Market commentators at La Lettre de Kobeissi argued that the company could be hurt if it tried to replace a successful leader without a clear successor.
“Don’t fire Jensen Huang,” they wrote in an article on X. “There is no clear replacement for Jensen Huang. We believe his departure would ultimately be a net negative for Nvidia, its shareholders and the AI revolution.”
Instead, they urged the board to conduct a thorough investigation and consult with shareholders “with a strong focus on shareholders.” They also pointed to Nvidia’s 35% drop in about 26 trading days, with half of that drop due to the scandal, and pointed out that the market had priced in Huang’s withdrawal by about 80%.
“Why take a step with huge downside potential when the market has already priced in much of that risk? » asked Kobeissi.
In their view, while there are some downsides to holding on to Huang, the upside potential could be “huge.”
The article Binance Traders Price in Potential Jensen Huang Exit as Nvidia Falls 8% appeared first on CryptoPotato.
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