Bank of England Probes Data Centers Lending Boom Amid AI Investment Frenzy

The Bank of England (BOE) has launched an investigation into the growing trend of financiers lending to data centers. This practice is increasingly viewed as a way to speculate on the booming artificial intelligence (AI) industry, Bloomberg reported Friday.

The move comes as the UK’s central bank deepens its scrutiny of potential market risks linked to AI. Officials have already warned that inflated valuations of AI companies could lead to a sharp correction, drawing parallels to the dot-com crash of the early 2000s. 

The new probe expands that focus to examine the relationship between AI developers and the financiers betting on their future success through data-center lending.

Lending to Data Centers Becomes a High-Stakes AI Bet

While lending to data centers remains a niche market, analysts say it could soon become a key funding channel for the AI sector. According to McKinsey & Co, an estimated $6.7 trillion will be further required by 2030 to meet the growing demand for infrastructure capable of powering AI technologies.

The BOE reportedly launched its investigation after noticing a shift in capital flows, from funding staff expansion and software development to massive investments in data center construction. With few publicly traded AI-native stocks available and tokenized private equity in its infancy, lending to data centers has also emerged as one of the few viable ways for financiers to gain exposure to the AI boom.

However, regulators fear that this debt-fueled approach could create systemic risks if AI growth slows or valuations tumble. “If the projected scale of debt-financed AI and associated energy infrastructure investment materializes over this decade, financial stability risks are likely to grow,” the BOE said Friday.

Encouraging AI, Restricting Crypto

The BOE’s cautious stance on AI contrasts with its tighter policies on cryptocurrencies, which have drawn criticism from the UK’s crypto sector. The central bank also recently proposed limits on individual stablecoin holdings, between £10,000 ($13,310) and £20,000 ($26,620).

Although the BOE says these restrictions are temporary, many UK banks have already taken steps to limit crypto exposure. In a recent survey of 2,000 investors, about 40% said their banks had blocked or delayed payments to crypto providers.

As the UK positions itself as a potential hub for AI innovation, the BOE’s probe underscores a broader concern: that rapid, debt-driven growth in AI infrastructure could threaten financial stability. Balancing innovation with risk management, the bank warned, will be crucial to avoiding the kind of speculative bubble that once shook the tech world.