The securitization of the GPU has arrived
Silicon is the new crude. Banks are drilling. The tweet from The Economist on February 21 confirms what the trading floors in Lower Manhattan have whispered for months. If you can measure it, you can financialize it. If you can financialize it, you can break it. The global hunger for compute power has transitioned from a supply chain headache into a full blown asset class. We are no longer just buying chips. We are trading the future right to use them.
The mechanics are predatory. Private equity firms are now issuing Compute-Backed Securities (CBS). These instruments wrap the lease agreements of massive H100 and B200 clusters into tradable bonds. According to recent data from Bloomberg, the volume of GPU-collateralized debt has surged 400 percent since the third quarter of last year. Lenders are valuing these chips as durable infrastructure. This is a mistake. Unlike a warehouse or an oil tanker, a GPU is a melting ice cube. It depreciates the moment a more efficient architecture is taped out in Taiwan.
The depreciation trap and the Moore’s Law margin call
Obsolescence is the primary enemy of the financial engineer. In traditional commodity markets, oil does not become less flammable because a better fuel is discovered. In the compute market, the utility of a chip is relative. When the next generation of Blackwell successors hits the data centers, the collateral value of the current fleet will crater. This creates a systemic risk for the shadow banks holding these assets. If the spot price for compute falls below the debt service cost, the margin calls will be swift. We are seeing the first signs of this tension in the secondary markets for used enterprise silicon.
| Hardware Model | Purchase Price (Unit) | Hourly Lease Rate | Annualized Yield | 12-Month Depreciation |
|---|---|---|---|---|
| Nvidia H100 | $22,500 | $1.85 | 72% | 45% |
| Nvidia B200 | $38,000 | $3.10 | 71% | 30% |
| AMD MI350X | $29,500 | $2.40 | 71% | 38% |
The numbers look lucrative on paper. A 70 percent yield is a siren song for yield-starved institutional investors. However, these yields do not account for the electricity overhead or the cooling costs which have risen by 12 percent year-over-year. Per reports from Reuters, the energy grid constraints in Northern Virginia and Dublin are now the primary bottleneck for compute delivery. A bond backed by a GPU that cannot be powered is a bond backed by a paperweight.
Visualizing the Compute Volatility Index
The following chart illustrates the volatility of the Compute Spot Price Index over the last twelve months. Note the sharp decline in January as the market anticipated the latest hardware refresh cycle. This volatility is exactly why the financialization of chips remains a high-stakes gamble for the uninitiated.
Compute Spot Price Index Volatility (Feb 2025 – Feb 2026)
The fearsome obstacles of physical reality
Wall Street hates physical constraints. Derivatives are clean. Data centers are dirty. The “fearsome obstacles” mentioned by The Economist refer to the friction between digital assets and physical infrastructure. You cannot settle a compute contract if the fiber optic cable is severed or if the local utility implements rolling blackouts. We are seeing a new type of counterparty risk emerge. It is the risk that the cloud provider hosting the collateral goes bankrupt or faces regulatory seizure.
The SEC is already circling. There are growing concerns regarding the lack of transparency in how compute-backed debt is rated. Most of these assets are currently rated as investment grade by boutique firms that specialize in tech-heavy portfolios. This mirrors the pre-2008 era where complexity masked the underlying fragility of the collateral. If the AI revenue models for mid-cap software companies do not materialize by the end of the second quarter, the demand for this compute will vanish. The surplus will flood the market. The value of the collateral will evaporate.
The next major milestone to watch is the March 15 release of the quarterly utilization reports from the big three hyperscalers. If the utilization rates for the newly deployed B200 clusters show even a minor dip below 85 percent, expect a massive repricing of compute-backed securities. The market is currently priced for perfection. Reality is rarely that cooperative.
