Tech companies are increasingly turning to loans backed by the chips used to train large language models, marking a new frontier in AI financing. As the AI arms race intensifies, companies are leveraging their most valuable hardware assets to secure funding for expansion.

This innovative lending approach comes as Paramount appears set to acquire Warner Bros Discovery after Netflix declined to increase its offer. Meanwhile, Wall Street is developing complex trades to hedge against potential tech stock sell-offs, particularly in the AI sector where valuations have soared.

The shift toward chip-backed lending reflects the growing importance of specialized hardware in the AI ecosystem. As companies race to build more powerful models, the demand for advanced chips has created a new form of collateral that lenders are eager to utilize. This development could reshape how tech companies access capital