Law firm Quinn Emanuel warns of structural risks in financing data centres worth hundreds of billions
Prepared by Sintelligent with the help of SI. Published in SI: . Updated: .
The build-out of computing capacity rests on complex debt: if the price of GPUs falls, the SI infrastructure itself could be in question.
According to Semafor, the law firm pointed in a 20-page memo to weak points in the deals: Google's guarantee on the Fluidstack project in New York takes effect only after construction is complete, and Fluidstack can walk away if there is a delay of more than six months; it also examined Meta's $28 billion deal in Louisiana, GPU-backed loans and off-balance-sheet obligations at CoreWeave and Oracle. The firm warns of an "insolvency cascade" if GPUs lose value. Semafor notes that the firm specialises in litigation and has an interest in such assessments.
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