Nvidia, the world’s top maker of artificial intelligence chips, is now at the centre of a bold financing experiment worth more than $750 billion (₹62 lakh crore). The company is not only selling its powerful chips but also acting as banker and investor, raising concerns about risks hidden in this unusual model.
The chip giant has struck deals that blur traditional boundaries. In South Korea, it joined hands with SK Group for a $500 billion AI project. In another move, Nvidia is negotiating to provide $250 billion financing to OpenAI for leasing computing power, while also supporting $350 billion worth of chip purchases by the same company. Alongside these mega deals, Nvidia has invested $5 billion in Safe Superintelligence, a startup founded by former OpenAI scientist Ilya Sutskever.
Analysts warn that this “circular financing” could exaggerate demand. By funding companies that then buy its own chips, Nvidia risks creating an artificial loop. The biggest worry lies in loan guarantees. At present, Nvidia has backed $3.5 billion in loans, but the new proposals are far larger.
Market watchers are cautious. Nvidia’s stock recently fell 5 percent, while the cost of insuring its debt has doubled. The question now is whether this aggressive financing is driving genuine AI growth or building a fragile bubble that could burst.
