Jensen Huang, chief executive officer of Nvidia Corp., during the Taiwan Semiconductor Manufacturing Co. (TSMC) sports day event in Hsinchu, Taiwan, on Saturday, Nov. 8, 2025.

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When Nvidia this week said it would take a $2 billion stake in chip design company Synopsys, it was just the latest in a string of massive investments announced by the chipmaker this year.

Nvidia has also said it would take a $1 billion stake in Nokia, invest $5 billion in Intel and $10 billion in Anthropic — $18 billion in investment commitments from those four deals, not counting smaller venture capital investments.

That doesn’t even include the biggest commitment of all: $100 billion to buy OpenAI shares over a number of years, although there is still no definitive agreement, Nvidia finance chief Colette Kress said Tuesday at the UBS Global Technology and AI conference.

It’s a lot of money and a lot of deals, but Nvidia’s got the cash to write big checks.

At the end of October, Nvidia had $60.6 billion in cash and short-term investments. That’s up from $13.3 billion in January 2023, just after OpenAI released ChatGPT. That launch three years ago was key to making Nvidia’s chips the most valuable tech product.

As Nvidia has transformed from a maker of gaming technology into the most valuable U.S. company, its balance sheet has become a fortress, and investors are increasingly wondering what the company will do with its cash.

“No company has grown at the scale that we’re talking about,” said CEO Jensen Huang, when asked what the chipmaker plans to do with all its cash, on Nvidia’s earnings call last month.

Analysts polled by FactSet expect the company to generate $96.85 billion in free cash flow this year alone and $576 billion in free cash flow over the next three years.

Some analysts would like to see Nvidia spend more of its cash on share repurchases.

“Nvidia is set to generate over $600B in free cash flow over the next few years and it should have a lot left over for opportunistic buybacks,” wrote Melius Research analyst Ben Reitzes in a note on Monday.

The company’s board increased its share repurchase authorization in August, adding $60 billion to its total. In the first three quarters of the year, it spent $37 billion on share repurchases and dividends.

“We’re going to continue to do stock buybacks,” Huang said.

Nvidia is doing the buybacks, but it’s not stopping there.

Huang said that Nvidia’s balance sheet strength gives its customers and suppliers confidence that orders in the future, which he called offtake, will be filled.

“Our reputation and our credibility is incredible,” Huang said. “It takes a really strong balance sheet to do that, to support the level of growth and the rate of growth and the magnitude associated with that.”

Kress, Nvidia’s CFO, on Tuesday said the company’s “largest focus” is making sure it has enough cash to deliver its next-generation products on time. Most of Nvidia’s largest suppliers are equipment manufacturers like Foxconn and Dell, which can require that Nvidia provide working capital to manage inventory and build additional manufacturing capacity.

Huang called his company’s strategic investments “really important work” and said that if companies like OpenAI grow, it drives additional consumption of AI and Nvidia’s chips. Nvidia has said that it does not require any of its investments to use its products, but they all do anyway.

“All of the investments that we’ve done so far — all of it, period — is associated with expanding the reach of Cuda, expanding the ecosystem,” Huang said, referring to the company’s artificial intelligence software.

In an October filing, Nvidia said it had has already made $8.2 billion in investments in private companies. For Nvidia, those investments have replaced acquisitions.

Nvidia’s $7 billion acquisition of Mellanox in 2020 is the largest the company has ever made, and it laid the groundwork for its current AI products, which aren’t single chips but entire server racks that sell for around an estimated $3 million.

But the company faced regulatory issues when it tried to buy chip technology firm Arm for $40 billion in 2020.

Nvidia called off the deal before it could be completed after regulators in the U.S. and U.K. raised concerns about its effects on competition in the chip industry. Nvidia has purchased some smaller companies in recent years, to bolster its engineering teams, but it hasn’t completed a multibillion acquisition since the Arm deal failed.

“It’s hard to think about very significant, large types of M&A,” Kress this week said, speaking at an investor conference. “I wish one would come available, but it’s not going to be very easy to do so.”

WATCH: Nvidia CEO says he supports export controls ahead of Senate Banking Committee meeting

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Bitwise Spot Bitcoin ETF (BITB) signage on the floor of the New York Stock Exchange (NYSE) in New York, US, on Thursday, Jan. 11, 2024, with trading commencing on the first US exchange-traded funds that invest directly in the biggest cryptocurrency.

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If the vision of Larry Fink — CEO of BlackRock, the world’s biggest money manager — becomes reality, all assets from stocks to bonds to real estate and more would be tradable online, on a blockchain.

“Every asset — can be tokenized,” Fink wrote in his recent annual letter to investors.

Unlike traditional paper certificates signifying financial ownership, tokens live securely on a blockchain, enabling instant buying, selling, and transfers without paperwork or waiting — “much like a digital deed,” he wrote.

Fink says it would be nothing short of a “revolution” for investing. Think 24-hour markets and a trading settlement process that can be compacted down into seconds from a process that today can still take days, with billions of dollars reinvested immediately back into the economy.

But there’s one big problem, one technology challenge that stands in the way: the lack of a coordinated digital identity verification system.

While technology experts say Fink’s idea isn’t improbable, they agree that there are cybersecurity challenges ahead in making it work.

Verifying asset owners in world of AI deep fakes

Today, it’s not easy to verify online that the person you are interacting with is that person because of the prevalence of AI deepfakes and sophisticated cybercriminals, according to Christina Hulka, executive director of the Secure Technology Alliance, an organization focused on identity, access and payments. As a result, having a unified verification system would be useful because there would be cryptographic validation that people are who they say they are.

“The [financial services] industry is focused on how to build a zero-trust framework for identification. You don’t trust anything until it’s verified,” Hulka said. “The challenge is getting everyone together about which technology to use that makes it as simple and as seamless for the consumer as possible,” she added. 

It’s hard to say precisely how a broad-based digital verification system would work but to support a fully tokenized financial structure, a system would, at a minimum, need to meet stringent security requirements, particularly those tied to financial regulations like the Know Your Customer rule and anti-money laundering rules, according to Zulfikar Ramzan, chief technology officer at Point Wild, a cybersecurity company.

At the same time, the system would need to be low friction and quick. There’s no shortage of technical tools today, especially from the field of cryptography, that can effectively bind a digital identity to a transaction, Ramzan said. “Fifteen to 20 years ago, this conversation would have been a non-starter,” he added.

There have been some successes with programs like this across the globe, according to Ramzan. India’s Aadhaar system is an example of a digital identity framework at a national scale. It enables most of the population to authenticate transactions via mobile devices, and it’s integrated across both public and private services. Estonia has an e-ID system that allows citizens to do everything from banking to voting online. Singapore and the UAE have also implemented strong national identity programs tied to mobile infrastructure and digital services. “While these systems differ in how they handle issues like privacy, they all share a key trait: centralized government leadership that drove standardization and adoption,” Ramzan said.

Centralized personal data is a big target for cybercriminals

While a centralized system solves one challenge, the storage of personally identifiable information and biometrics data is a security risk, said David Mattei, a strategic advisor in the fraud and AML practice at Datos Insights, which works with financial services, insurance and retail technology companies. 

Notably, there have been reports of data stolen from India’s Aadhaar system. And last year, El Salvador’s government had the personal data of 80% of its citizens stolen from a centralized, government-managed citizen identity system. “A lot of security experts do not advocate having a centralized security system because it’s kind of like the pot at the end of the rainbow that every fraudster is trying to get his hands on,” Mattei said.

In the U.S., there’s a long-standing preference for decentralized systems for identity. On mobile devices, Face ID and Fingerprint ID are done not by centralizing all of that data in one spot at Apple or Google, but by storing the data in a secure module on each mobile device. “This makes it much harder, if not impossible, for fraudsters to steal that data en masse,” Mattei said.

Larry Fink, chief executive officer of BlackRock Inc., at the Berlin Global Dialogue in Berlin, Germany, on Tuesday, Oct. 1, 2024. 

Bloomberg | Bloomberg | Getty Images

Digital driver’s licenses offer a cautionary tale

It would take a significant coordinated effort to come up with a national identity system used for identity verification.

Identity systems in the U.S. today are fragmented, Ramzan said, giving the example of state departments of motor vehicles. “To move forward, we will either need a cohesive national strategy or a way to better coordinate identity across the state and federal levels,” he said.

That’s not an easy task. Take, for example, the effort many states are making to adopt digital driver’s licenses. About a quarter of states today, including Utah, Maryland, Virginia and New York, issue mobile driver’s licenses, according to mDLConnection, an online resource from the Secure Technology Alliance. Other states have pilot programs in effect, have enacted legislation or are studying the issue. But this undertaking is quite ambitious and has been underway for several years.

To implement a national identity verification system would be a “massive undertaking and would require just about every company that does business online to adopt a government standard for identity verification and authentication,” Mattei said.

Competitive forces are another issue to contend with. “There is an ecosystem of vendors who offer identity verification and authentication solutions that would not want a centralized system for fear of going out of business,” Mattei said. 

There are also significant data privacy hurdles to overcome. States and the federal government would need to coordinate to resolve governance issues, and this might prompt “big brother” concerns about the extent to which the federal government could monitor the activities of its citizens.

Many people have “a bit of an allergic reaction” when anything resembling a national ID comes up, Ramzan said.

Fink has been pushing the SEC to look at issue

The idea is not a brand new one for Fink. At Davos earlier this year, he told CNBC that he wanted the SEC “to rapidly expand the tokenization of stocks and bonds.”

There’s BlackRock self-interest at work, and potential cost savings for the firm and many others, which Fink has spoken about. In recent years, BlackRock has been dragged into political battles, and lawsuits, over its voting of a massive amount of shares held in its funds on ESG issues. “We’d never have to vote on a proxy vote anymore,” Fink told CNBC at Davos, referring to “the tax on BlackRock.”

“Every owner would be notified of a vote,” he said, adding that it would bring down the cost of ownership of stocks and bonds.

It is clear from Fink’s decision to give this issue prominent placement in his annual letter — even if it came in third in the order of issues he covered behind both the politics of protectionism and the growing role of private markets — that he isn’t letting up. And what’s needed to make this a reality, he contends, is a new digital identity verification system. The letter is short on details, and BlackRock declined to elaborate, but, at least on the surface, the solution for Fink is clear. “If we’re serious about building an efficient and accessible financial system, championing tokenization alone won’t suffice. We must solve digital verification, too,” he wrote.

Blockchain continues to evolve and people are learning to understand it better. Accordingly, there are initiatives underway to think about how the U.S. can achieve a broad-based identity verification system, Hulka said. There are technical ways to do it, but finding the right way that works for the country is more of a challenge since it has to be interoperable. “The goal is to get to a point where there is one way to verify identity across multiple services,” she said.

Eventually, there will be a tipping point for the financial services industry where it becomes a business imperative, Hulka said. “The question is when, of course.”

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