Agreed. The people who don’t see this haven’t used the technology besides trying to find a dinner recipe.
Compute retweeted
$NUAI price action has absolutely sucked over the past 14 days, along with the rest of the sector. No sugarcoating it.
Has the thesis changed? Absolutely not.
Look at the valuations of some of NUAI’s peers:
$WULF: ~$5.8B | 839 MW contracted
$HUT: ~$8.4B | 949 MW contracted
$APLD: ~$5.5B | 1,410 MW contracted
Meanwhile, $NUAI sits at just ~$331M, with 207 MW gross (~148 MW IT) in P1 and another ~550 MW gross (~393 MW IT) in P2.
Much of these peers’ contracted capacity is still under construction or awaiting delivery. Yet the market already assigns billions in value to these developments.
We still believe BOTH phases of $NUAI will be contracted. That’s ~541 MW of potential IT capacity.
And with lease economics improving dramatically, we believe NUAI could secure even more attractive terms.
Yes, we still need signed leases, financing and execution. But that’s precisely where we see the valuation opportunity.
14 days of red haven’t changed the story.
@optionology @fnitefiend
Either this is the biggest buying opportunity of a lifetime, or we are all retarded and missing something.
I know, it’s unintuitive. You think they’d wait, but that’s not how demand and Jevons paradox works. Do some reading up on it.
Okay. Nevermind. You’re right, they shouldn’t have given up equity to grow and it’s a good measure of their ROIC. (Sarcasm)
Compute retweeted
This is a really good question and I’ve done a lot of thinking on this myself. In theory, the cost of intelligence drops down to the cost of an electron as a function of time. So the question is, where is the value accrued at if it’s a race to the bottom?
First it’s important to look at the frontier labs as they are on everyone’s mind and it seems like a headline comes out every day talking about how they are going to fail. It’s important to see that they currently capture their value from the differential of intelligence over its competitors. As time goes on, assuming that these behind them are catching up that differential closes, especially with open source on their tail. Obviously the heads of Anthropic and OpenAI know this, and it’s the reason why they have been so heavily focused on preventing distillation from taking place. It was important that they cracked down on this, despite causing an interim flatlining in revenues, because their entire value proposition relies on it. The next step is to reach full RSI (Recursive Self Improvement) where the models train themselves. I included a graph from Leopold Aschenbrenner’s Situational Awareness paper here to demonstrate what happens when AI’s reach RSI. This will likely be the breaking point away from open source models, and it will give the frontier labs such a decisive lead in the intelligence race.
Now, the question is how much are OpenAI and Anthropic willing to spend to get to this point as soon as possible? The truth is, from a game theory perspective, their entire business model relies on it. On the other end of that curve is the cure to every single illness, physics problem, robotics, etc and that’s where the true value is accrued. How much do you believe they are willing to spend on compute here for the time being?
This brings me back to the original question you asked which was what does it mean for the price of compute/power. It depends on how much value you believe is on the other side of this and how fast they can achieve this. That’s why short term power is so valuable right now. The problem is on the capital side for the time being where many of these projects are not going to be completed due to power, driving up the $/MW and financing rates. But this then goes back to more capital for Anthropic and OpenAI to pay to fund their future commitments. For these reasons don’t see how the price can peak unless lenders stop lending, which the Gov can’t let happen in the current economic state.
