Expansion of AI-focused data centers — a drive increasingly aided by Bitcoin miners — is being financed largely through high-yield bond issuance, underscoring how markets are valuing the risk and reward in this space.
According to a recent TheEnergyMag newsletter, companies involved in AI data-center development have issued roughly $33 billion of long-term senior notes over the past 12 months, excluding convertible securities. Borrowing costs in the sector sit well above those for regulated utilities and conventional energy companies: the latter typically secure financing with yields near 4%–5%, while issuers tied to AI and crypto-related projects are paying in the neighborhood of 7%–9%.
Janus Henderson Investors, citing BofA Global Research, reports the average coupon on newly issued U.S. dollar high-yield debt was about 7.2% in late 2025, down from the roughly 8%–9% levels seen in 2023. Issuers at the upper end of the yield range are often current or former digital-asset mining firms that have pivoted to building AI infrastructure, signaling that capital remains comparatively expensive for that group.
Recent high-yield offerings highlighted by TheEnergyMag include CoreWeave’s notes at 9.25% and 9% in May and July 2025, Applied Digital’s 9.2% issuance in November, TeraWulf’s 7.75% deal, and Cipher Mining’s bonds at 7.125% and 6.125%. Credit ratings and perceived operational and market risks are the main drivers of these spreads.
Lenders appear to be drawing a distinction between traditional infrastructure and newer AI- or crypto-linked projects. Assets with regulated load or contracted generation are still treated as infrastructure finance, while AI and Bitcoin-linked developments — even when backed by long-term offtake agreements — are often classified as growth credit and priced accordingly.
Despite debates over potential overspending and a risk of overcapacity, the build-out of AI infrastructure remains a central industry theme. Nvidia’s strong fourth-quarter results have reinforced that momentum, with reported profit up 94% and revenue up 73% year-on-year, amounting to $43 billion in net income and $68.1 billion in revenue in the quarter reported.
Separately, Bitcoin mining companies are planning nearly 30 gigawatts of additional power capacity aimed at AI workloads — almost three times the capacity they currently operate. Much of that capacity is still in the early planning or development stage, but it reflects a clear strategic shift toward AI infrastructure within the mining sector.
This article is based on reporting from TheEnergyMag and industry data cited by Janus Henderson Investors and BofA Global Research. Cointelegraph is committed to independent, transparent journalism; readers should verify information independently. Read Cointelegraph’s Editorial Policy at https://cointelegraph.com/editorial-policy.