CoreWeave acquires $2.3 billion in debt by putting NVIDIA H100 GPUs as "collateral"

HomeHardwareCoreWeave acquires $2.3 billion in debt by putting NVIDIA H100 GPUs as "collateral"
CoreWeave acquires $2.3 billion in debt by putting NVIDIA H100 GPUs as "collateral"

CoreWeave, a specialized cloud provider, has managed to receive $2.3 billion in funding using NVIDIA's highly sought-after H100 GPUs as collateral.

NVIDIA's H100 GPUs have now become a financial asset with increasing demand and limited supply

The AI industry has witnessed rapid expansion and the demand from the sector has reached new levels, which is why companies like CoreWeave are giving it their all to expand their existing facilities. It is said that the company intends to meet the "increasing AI workload" through colossal funding. Lenders of the amount include Coatue, DigitalBridge, BlackRock, PIMCO and Carlyle. For those unfamiliar with the term "security", it puts in a financial asset as collateral for the acquired debt, which is NVIDIA's H100 GPUs.

The astonishing fact of this report is that NVIDIA's H100 AI GPUs are used as a "security capital", which shows the importance and value of these GPUs. H100 GPUs worth $2.3 billion aren't easy to come by, and you might be wondering how CoreWeave got such an amount in the first place. While the answer is simple but interesting. CoreWeave has received "exclusive" support from NVIDIA regarding obtaining the necessary equipment, including H100 GPUs and HGX H100 supercomputers. You can categorize these items as the "holy grail" of the industry.

CoreWeave is ahead of its CWS competitors, such as Google and Microsoft, largely due to the benefits of a "private" relationship with NVIDIA. The AI fiasco in one place has brought innovation and automation, but it has also upset the balance of the industry since AI requires massive computing capabilities, which in this case NVIDIA is providing for now. We can say that success in the industry now lies directly in the company's relationship with NVIDIA.

CoreWeaves CEO Michael Intrator has also expressed his opinion on acquiring the debt, arguing that it is much more cost effective and easier to get the debt through an "asset base". The company plans to manufacture a state-of-the-art data center facility in Texas, with plans for rapid expansion across the United States.

In summary, it is said that the AI industry has taken another shift, with NVIDIA taking the spotlight for now. Using GPUs as a security now tells us how important things have become and as a journalistic note we believe there is a great need to break the monopoly. AMD has expressed its desire to break NVIDIA's dominance in Chinese markets through a cut-down "MI300" AI accelerator, but will it do the job? The future holds plenty for consumers and businesses, and we look forward to seeing how the industry develops.

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