Tether enters AI space with $420M Cloud GPUs purchase

Tether has made an entry into the AI space with a strategic investment in Bitcoin miner Northern Data.
Media reports say Tether purchased 10,000 Nvidia H100 GPUs worth $420 million.

Tether, the company behind the $83 billion stablecoin USDT, has marked its foray into the AI tech space with a strategic investment in Europe-based crypto mining firm Northern Data.

A news release by Tether noted that the investment was made via Damoon, a Tether group company. The stablecoin issuer did not disclose the amounts involved, only stating that Forbes’ report had misrepresented the company’s “stake size in the investment.”

“We are excited about this investment into Northern Data Group as it represents a fresh venture into new technological frontiers,” said Paolo Ardoino, the Tether CTO.  He added: “This investment underscores our commitment to responsible growth and innovation while preserving the strength and integrity of Tether tokens’s reserves.”

Tether will collaborate with Northern Data on various AI initiatives, peer-to-peer communications, and data storage solutions.

Global demand for AI GPUs

Nvidia’s H100 is arguably one of the most important computer chips in the market, partly why the Nasdq-listed company has a massive bet on AI. Even though it’s priced at $40,000, the H100 is seeing massive demand thanks to its capabilities around heavy-duty data processing. It’s a key commodity in the AI startup world.

In its report, Forbes said Tether had made a $420 million investment in Northern Data’s artificial intelligence business, purchasing 10,000 Nvidia H100 GPUs via Damoon. Per the publication, Tether was set to acquire a 20% stake in Northern Data, which will rent the in-demand chips to startups across the AI industry.

Tether does acknowledge that the deal with Northern Data puts it on the cusp of becoming the “biggest independent AI player in Europe.” That’s likely given the investment is reportedly bigger than what some countries have outlined.

For example, a recent report by The Telegraph indicated that the British government planned to spend $120 million (£100 million) on GPUs. Elsewhere, Saudi Arabia is said to have acquired 3,000 pieces of the Nvidia H100 as it looks to power its AI projects.