Nvidia Absorbs Another Rival for $20B, Boosting Decentralized AI

NVIDIA has agreed to pay approximately $20 billion to acquire assets from artificial intelligence chip startup Groq, marking the companys largest transaction on record and continuing its strategy of absorbing potential competitors before they can challenge its market dominance. The chipmakers latest licensing deal mirrors a similar transaction just three months ago, reinforcing the narrative that decentralized AI infrastructure may offer the only alternative to Nvidias growing dominance. Threefold Premium in Three Months with Trump Jr. Connection The deal closed just three months after Groq raised $750 million at a $6.9 billion valuationa round that included BlackRock, Samsung, Cisco, and 1789 Capital, where Donald Trump Jr. serves as a partner. Nvidia is acquiring all of the companys assets substantially, except its cloud computing business, though Groq framed the transaction as a non-exclusive licensing agreement. Groq CEO Jonathan Ross, a former Google engineer who helped create the search giants Tensor Processing Unit, will join Nvidia along with president Sunny Madra and other senior executives. The startup will continue operating independently under CFO Simon Edwards as its new chief executive. A Repeating Playbook The Groq transaction follows a pattern Nvidia established just three months earlier. In September, the company paid over $900 million to hire Enfabricas CEO and employees while licensing the startups technology. Both deals use licensing structures rather than outright acquisitions, potentially avoiding the antitrust scrutiny that blocked Nvidias $40 billion bid for Arm Holdings in 2022. The Kobeissi Letter summarized Nvidias approach bluntly: We will buy you before you can compete with us. Nvidia's newest strategy:"We will buy you before you can compete with us."There has never been a company like Nvidia. Technical Edge and Competitive Pressure Groqs Language Processing Unit uses on-chip SRAM rather than external DRAM, enabling what the company claims is up to 10x better energy efficiency. This architecture excels at real-time inference but limits model sizea tradeoff Nvidia can now explore within its broader ecosystem. The timing is notable. Google recently unveiled its seventh-generation TPU, codenamed Ironwood, and released Gemini 3, trained entirely on TPUs, to top benchmark rankings. Nvidia responded on X: Were delighted by Googles success NVIDIA is a generation ahead of the industryits the only platform that runs every AI model. When incumbents start issuing such reassurance statements, competitive pressure is clearly mounting. Implications for Decentralized AI While the deal has no direct impact on cryptocurrency markets, it reinforces the narrative driving decentralized AI computing projects. Platforms like io.net position themselves as alternatives to centralized AI infrastructure. People can put their own supply onto a network, whether thats data centers or yourself with your laptop, contributing your available GPU power, and getting fairly compensated for it using tokenomics, Jack Collier, io.nets Chief Growth Officer, told BeInCrypto. The platform claims enterprise clients, including Leonardo.ai and UC Berkeley, have achieved significant cost savings. However, the gap between narrative and reality remains wide. Nvidias acquisition of Groqs low-latency technology further extends its technical lead, making it harder for any alternative to offer competitive performance. The transaction also raises questions about independent AI chip development. Cerebras Systems, another Nvidia competitor preparing an IPO, may eventually face similar pressure. Whether it can remain independent or succumb to Nvidias financial gravity remains to be seen. Read the article at BeInCrypto