Nvidia perps slide as market reacts to CEO Jensen Huang's Chinese spy scandal

Nvidia perpetual futures slid on Hyperliquid following the AI chipmaker's Sunday announcement that its board of directors is investigating CEO Jensen Huang's relationship with a woman reportedly identified by intelligence officials as a Chinese spy.

Nvidia's NVDA-USDC perps fell 3.8% over the past 24 hours to $180.50 on Hyperliquid as of 10:10 p.m. ET Sunday, with 24-hour volume reaching $170 million. The perps began sliding around 4 p.m. ET, hitting a local low of around $178.10 before recovering slightly.

Earlier Sunday, Nvidia announced that it is launching an investigation into Huang following reports that he had been a "target of a foreign intelligence effort."

"While the Board has no reason to believe that either national security or NVIDIA secrets were compromised, the Board's inquiry will examine all available information," the statement said.

Nvidia also published an internal memo from Huang to employees in which he admitted to being unfaithful to his wife.

"I was unfaithful to my wife. My actions hurt her and our children. There is no excuse for what I did. I am deeply sorry," wrote Huang, adding that he supports the board of directors' investigation into the reported national security concerns and that he will fully cooperate.

The investigation came after the New York Times reported last week that a memo, circulated among top U.S. policymakers last spring, alleged that Alice Huang, a Chinese businesswoman, was recruited by China's Ministry of State Security to gather intelligence on Nvidia's founder.

"Today's news will not slow Nvidia. Jensen is committed to continuing to lead Nvidia as CEO without interruption," a company spokesperson told The Block.

On Polymarket, a prediction market indicated a 16% chance that Huang would announce his resignation or be removed by Dec. 31, 2026. A similar market on Kalshi put the odds of his departure by Jan. 1, 2028, at 18%.

Broader market reaction

Meanwhile, bitcoin Bitcoin (BTC) fell 0.8% to $75,113, while ether Ethereum (ETH) lost 4.2% to trade at $2,140, according to The Block's price page.

Stock futures, however, edged higher late Sunday. The S&P 500 futures rose 0.6%, while the Nasdaq 100 edged up 0.7%.

Asian equities advanced on Monday morning. The Taiwan Weighted Index rose 5.4%, while Japan's Nikkei 225 rose 3.2%. South Korea's Kospi gained 1.7%.

Dan Khus, chief analyst at LVRG Research, told The Block that the slide in Nvidia perps "reflects a classic risk-off reaction," with the drop "likely amplified by leveraged positioning."

"Bitcoin's modest decline suggests limited direct spillover, while Ether's sharper fall points to broader altcoin sensitivity," Khus said.

Rick Maeda, head of markets at Laevitas, said that with U.S. cash markets shut, NVDA perpetual futures on crypto platforms such as Hyperliquid were the only place for price discovery, so "it took the first reaction on thinner liquidity."

"However, the overhang will last as long as the investigation does and the real risks are congressional escalation, tighter scrutiny of China-linked sales, or any sign of a leadership change, given how central Huang is to Nvidia’s story," Maeda added.

Meanwhile, Dominick John, analyst at Zeus Research, said the decline in Nvidia per "signaled weakening near-term sentiment and increased bearish positioning."

"Deeply negative funding suggests short positioning may be becoming crowded, leaving room for a relief rebound if underlying U.S. equities stabilize," said John.