Risks in AI infrastructure are spreading from stocks to credit markets
Bloomberg reported that an anonymous seller has put up for sale about $500 million in data center loans, covering 12 assets. These include a $25 million share of the Stargate New Mexico project. Bids are due November 19, and the winning bid will provide the first public pricing for assets of this kind since the midterm elections.
Credit markets have already reacted: CoreWeave’s high-yield bonds fell to a low of 78 cents on the dollar, with yields exceeding 15%. Meanwhile, bonds issued by crypto company Galaxy Digital, which also operates data centers, were among Thursday’s biggest decliners.
This sale will test the actual value of AI infrastructure debt. If the auction clears at a steep discount or more banks follow suit and resell loans, data center financing costs will rise, prompting institutions to reduce their risk exposure and indirectly weighing on BTC liquidity and risk appetite. However, BTC’s decline so far has been driven mainly by deleveraging in equities and expectations of tighter monetary policy, and should not be attributed to this sale.
What to watch next: the discount on the November 19 sale, whether more institutions put assets up for resale, and the December 7 permitting hearing for the New Mexico power plant.
Bloomberg reported that an anonymous seller has put up for sale about $500 million in data center loans, covering 12 assets. These include a $25 million share of the Stargate New Mexico project. Bids are due November 19, and the winning bid will provide the first public pricing for assets of this kind since the midterm elections.
Credit markets have already reacted: CoreWeave’s high-yield bonds fell to a low of 78 cents on the dollar, with yields exceeding 15%. Meanwhile, bonds issued by crypto company Galaxy Digital, which also operates data centers, were among Thursday’s biggest decliners.
This sale will test the actual value of AI infrastructure debt. If the auction clears at a steep discount or more banks follow suit and resell loans, data center financing costs will rise, prompting institutions to reduce their risk exposure and indirectly weighing on BTC liquidity and risk appetite. However, BTC’s decline so far has been driven mainly by deleveraging in equities and expectations of tighter monetary policy, and should not be attributed to this sale.
What to watch next: the discount on the November 19 sale, whether more institutions put assets up for resale, and the December 7 permitting hearing for the New Mexico power plant.
