Hwang In-hoon personally “lobbied” Wall Street: Nvidia (NVDA.US) teamed up with six giants to turn GPUs into “real estate that would lay the golden egg” and leverage the $500 billion hashrate mortgage market

The Zhitong Finance App learned that Nvidia (NVDA.US) is trying to make its artificial intelligence chip the newest asset class on Wall Street. The company has cooperated with six major asset management agencies to promote a $500 billion financing plan aimed at treating computing power infrastructure as commercial real estate, toll roads, or other collateral assets to provide customers with financing support.

Nvidia issued a statement on Monday saying it has signed memorandums of understanding with Apollo Global Management, Blackstone Group, Blackstone Group, Brookfield Asset Management, Goldman Sachs and KKR to jointly build a financing platform for Nvidia customers. Executives from the seven companies mentioned above appeared in a rare live interview on CNBC to jointly interpret this collaboration.

The plan aims to leverage more than $500 billion in third-party capital for hyperscale cloud service providers, cutting-edge AI laboratories, and various enterprises to build data centers and purchase Nvidia hardware. The move may mark an important shift in the AI infrastructure financing model — by introducing institutional credit, insurance funds, and private equity capital to guarantee GPUs and data centers, Nvidia helps its end users obtain financing without using their own balance sheets.

“This is indeed the first time that tech chips have become an investable asset class,” said Nvidia founder and CEO Hwang In-hoon. “Today, these chips are revenue-generating assets. They are productive, long-lasting, interchangeable, and flexible.”

Huang Renxun believes that since Nvidia hardware has been widely used and can be transferred between different customers, lenders can completely regard computing power as an asset with long-term earning capacity for reliable credit.

In the past, GPUs were generally viewed as hardware that depreciated faster. Nvidia's move is disrupting this traditional perception and turning AI computing power into a long-term, financeable infrastructure asset. However, skeptics may still be concerned about whether existing AI chips can continue to preserve their value as new generations of chips continue to be introduced.

“Fundamentally speaking, what is unique about this industry and this method of computing is that computers are now part of infrastructure — just like electricity and the internet — so you have to look at it from an infrastructure perspective,” Hwang In-hoon said in an interview.

Alternative asset management agencies have been keen to invest in digital infrastructure in recent years to finance projects by absorbing institutional and insurance capital. Apollo and Kuroishi have successively arranged debt and equity financing for companies such as Anthropic.

The financing comes after the global market experienced turmoil in July — at a time when investors began to question whether tech giants' huge investment in the AI field would pay off. As hyperscale vendors plan to continue to invest hundreds of billions of dollars in data centers and hardware, ratings agencies such as Moody's have issued warnings that unprecedented capital spending is beginning to squeeze free cash flow and force tech giants to bear heavier debt burdens.

A new chapter in “financial engineering”

Wall Street giant leaders, including BlackRock CEO Larry Fink, Blackstone CEO Jon Gray, and Goldman Sachs CEO David Solomon, said in a Monday press release that computing power has rapidly evolved into a key asset class driving the next phase of global economic growth.

“We are at a critical moment in the historic AI investment cycle,” Solomon said in a statement. “Our role in investment and distribution reflects our confidence in Nvidia's leadership and is excited about the new opportunity to create a credit market supported by Nvidia's computing power.”

Solomon revealed that Wong In-hoon personally proposed this financing idea to Wall Street giants.

Kuroishi's Gray said that AI computing power will be treated as a “financeable asset class,” just as a mortgage institution views real estate. He said that demand for AI far exceeds supply, and Blackstone portfolio companies' use of AI has surged sevenfold this year.

BlackRock's Fink believes that this project will be the beginning of “the next future of financial engineering,” similar to the birth of mortgage-backed securities in the 70s of the last century. He said that part of the capital has been raised, but BlackRock will “continue to increase its recruitment significantly.”

“We have to raise capital and get up and running as soon as possible because I think it's critical for the US to become a global AI leader,” Fink emphasized.