Morgan Stanley turns the AI bond market into a fee machine: $570 billion by 2026
The artificial intelligence industry is attracting capital through an unexpected instrument. Ordinary debt notes have become the main driver of the sector. According to Morgan Stanley estimates, by 2026, technology developers will raise $570 billion through bonds.
The focus remains on Nvidia and the new Chinese neural network Kimi K3 from the Moonshot AI team. Pension funds and insurance organizations are financing the technological breakthrough, operating without much fanfare.
How Morgan Stanley is turning the AI company bond market into a fee machine
Capital is moving at a record pace. By May 31, the volume of issued "AI debt" reached $236 billion — four times more than in the same period last year.
Morgan Stanley anticipated this growth. In just the end of 2025, the organization conducted bond issuance deals for AI companies worth $65 billion.
The result — $2.3 billion in fees over six months. A year ago, the figure did not exceed $1.4 billion. Thanks to this surge, Morgan Stanley surpassed Goldman Sachs and now trails only JPMorgan Chase.
Financiers are structuring credit obligations of IT giants and contracts for computing power. Conservative investors are eagerly buying the ready-made bonds.
Google's support and Meta's "hidden" debts
Company TeraWulf clearly demonstrates how this scheme works. The former bitcoin miner repurposed its capacities for neural network needs. The placement of $3.2 billion in debt securities brought in $10 billion in applications. The yield was 7.75% per annum.
The high demand for the low-rated miner's papers is explained by Google's involvement. Documents for the SEC regulator reveal details of the agreement. The tech giant guaranteed $3.2 billion in rent if operator Fluidstack stops payments. In return, Google received an option to buy 14% of TeraWulf's shares.
Cipher Mining concluded a similar deal. Shares of mining companies are growing faster than cryptocurrencies.
| Company | Project / Facility | Deal Amount | Special Conditions |
| TeraWulf | Data centers for AI | $3.2 billion | Rent guarantee from Google, option for 14% of shares |
| Meta | Hyperion campus in Louisiana | $27 billion | Private credit, 80% from partner Blue Owl |
Meta, recognized as extremist in Russia, chooses large-scale projects. With Morgan Stanley's assistance, the company raised $27 billion for the Hyperion complex. The deal became a record for the private credit market. Partner Blue Owl's share is 80%, so the obligations are not reflected on Meta's balance sheet.
Bond investors are starting to demand payment for patience
Buyers of debt securities are showing restraint. In February, refinancing of IT giants exceeded supply by five times. By July, the figure dropped below the double level. At the end of 2025, the cost of insurance against Oracle's default rose to its highest since 2009. Market participants' concerns are growing along with talks about the industry overheating.
Infrastructure costs continue to rise. Experts predict new large-scale injections.
- Required investments in data centers until 2028: $2.9 trillion.
- IT companies' own funds cover only 50% of needs.
- The remaining part will have to be raised through debt capital.
The development of railways and telecommunications in past eras relied on bonds. The debt market is financing the advancement of neural networks. Every microchip operates on credit funds. The cost of borrowing will determine the ultimate speed of technology adoption.
My opinion: we are witnessing a classic infrastructure financing bubble. As long as rates are low and AI demand grows, the scheme works flawlessly. But if the macroeconomic situation changes, the AI bond market could become a source of serious systemic volatility. Investors should closely monitor credit spreads.