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Grayscale’s Dogecoin and XRP ETFs Approved for Launch With Trading Starting on Monday

By
Paul Ugbede Godwin
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0

Grayscale Investments has received official approval from the NYSE Arca for its Grayscale Dogecoin Trust ETF (ticker: GDOG) and Grayscale XRP Trust ETF (ticker: GXRP).

Trading for both spot ETFs is scheduled to begin on Monday, November 24, 2025, marking another milestone in the institutional adoption of altcoins. This follows a series of regulatory filings, including S-1 registrations and 19b-4 applications, with the NYSE’s certification letters dated November 21.

These ETFs convert Grayscale’s existing closed-end trusts into publicly traded spot products, allowing investors to gain direct exposure to Dogecoin (DOGE) and XRP without holding the assets themselves.

Converts from private Dogecoin Trust launched Jan. 31, 2025; targets meme coin enthusiasts and high-volume traders. Builds on Ripple’s 2023 SEC victory; follows Bitwise’s XRP ETF launch on Nov. 20 with a waived fee for initial assets.

Both funds will trade on NYSE Arca and are structured as commodity-based trusts under SEC rules, sidestepping ongoing debates about XRP’s security status.

Grayscale’s move expands its lineup beyond Bitcoin and Ethereum ETFs, now including Solana and others amid a broader wave of altcoin products via Franklin Templeton’s upcoming Dogecoin ETF and Litecoin/HBAR funds.

The approvals come at a pivotal time for crypto, with altcoin ETFs gaining traction post-2024 regulatory shifts. Dogecoin, the original memecoin with massive community hype, has seen derivatives volume spike ahead of this launch, while XRP’s cross-border payment utility on the XRPL continues to attract institutional interest.

Pre-launch buzz on X is heating up, with users sharing SEC filings and predicting price surges—e.g., one post exclaimed “candles are coming” with links to the official approvals. Early trading signals are mixed: DOGE has shown sharp volatility, stabilizing around $0.137, while XRP derivatives hit $12.74B in volume with prices bouncing near $1.85.

Analysts like Eric Balchunas from Bloomberg peg approval odds high 90%+ for DOGE, 95% for XRP, and this dual launch could test investor appetite in a market pressured by Fed uncertainty. Grayscale’s broader strategy includes a U.S. IPO filing for its Class A shares on NYSE, signaling confidence in crypto’s mainstream push.

The NYSE’s greenlight for Grayscale’s GDOG (Dogecoin) and GXRP (XRP) ETFs, set to trade starting November 24, 2025, isn’t just another crypto filing—it’s a watershed moment that could reshape institutional access, market dynamics, and even regulatory norms for altcoins.

Building on the Bitcoin and Ethereum ETF wave, this dual launch the first simultaneous debut of two major altcoin spot ETFs signals accelerating mainstream integration amid post-2024 regulatory thawing. Expect fireworks on Monday, but with volatility as the headline act.

Pre-launch hype has already juiced derivatives: XRP’s open interest surged 51% to $12.74 billion, while DOGE’s price dipped 3% intra-day but stabilized around $0.158 amid ETF buzz. These ETFs convert existing closed-end trusts launched in early 2025, potentially unlocking $16M+ in pent-up assets for XRP alone and drawing fresh inflows from retail and institutions wary of direct custody.

History from ETH ETFs shows 10-20% pumps post-launch, but current macro headwinds, Fed rate jitters, shaky equities could cap gains. Bloomberg’s Eric Balchunas notes 95% approval odds for XRP and 90% for DOGE, predicting “strong interest” from their vocal communities—XRP’s $128B market cap and DOGE’s meme-fueled trading volume could amplify this.

With 0.35% fees; competitive vs. peers, expect arbitrage plays reducing trust premiums/discounts, tighter price tracking, and a liquidity boost. Bitwise’s recent XRP ETF launched Nov. 20 with waived fees sets a precedent—combined volume could test $15B+ in the first week.

By classifying DOGE and XRP as commodities sidestepping SEC security debates, especially post-Ripple’s 2023 win, these ETFs lower barriers for pensions, mutual funds, and advisors—addressing custody headaches that sidelined institutions. Grayscale’s $35B+ AUM positions it to capture billions in inflows, much like its GBTC did for BTC.

Meme coin institutionalization; attracts high-volume traders via regulated exposure. Could pull $500M+ in Year 1, per analyst estimates. Targets cross-border payment funds; leverages Ripple’s ecosystem for $1B+ potential, drawing asset managers post-SEC clarity.

Enhances XRPL adoption for remittances; could spur dev activity in DeFi/payments. 92 crypto ETFs in SEC queue by Aug. 2025; signals 2026 as “altcoin ETF year.” Volatility from hype cycles; needs utility proof to sustain. Lingering SEC appeal on security status could cap growth.

Macro pressures may delay full adoption. Grayscale’s parallel US IPO filing for NYSE-listed Class A shares underscores confidence, potentially valuing the firm at $10B+ and fueling more altcoin products.

Regulatorily, this cements a commodity-first path for non-BTC/ETH assets, contrasting the SEC’s past reluctance. The 240-day review clocks from February acknowledgments paid off faster than expected, hinting at a friendlier stance under current admin—paving for 65-75% odds on more approvals by year-end.

Overall, this turbocharges crypto’s maturity, but success hinges on Monday’s open. Bullish for holders? Absolutely, if volumes materialize. Broader market stress.

Tom Lee’s BitMine Immersion Announces Profitable 2025, as US Investigates Bitmain Over Rising Energy Consumption

By
Paul Ugbede Godwin
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0

BitMine Immersion Technologies, a leading Ethereum-focused digital asset treasury firm chaired by Wall Street veteran Tom Lee founder of Fundstrat Global Advisors, announced its fiscal year 2025 results.

The company reported strong financials despite a challenging crypto market, including net income of $328 million and fully diluted earnings per share (EPS) of $13.39. In a notable move, BitMine declared its first annual dividend of $0.01 per share, positioning it as the first large-cap crypto company to offer regular shareholder distributions.

This comes amid a dip in the firm’s multiple to net asset value (mNAV) for its ETH treasury, which has fallen below 1.0x due to Ethereum’s price weakness. Approximately $11.53 billion 3.4+ million ETH + minor BTC, but with ~$4.52 billion unrealized loss at current prices
mNAV Ratio.

Below 1.0x market cap < net asset value of ETH treasury. Stock is trading ~$26.49 up slightly intraday; down ~80% from July 2025 peak of $135, but +258% YTD. The multiple to net asset value (mNAV) measures a company’s market capitalization relative to the fair value of its underlying assets here, primarily ETH holdings, net of liabilities.

An mNAV below 1.0x means the stock is trading at a discount to the value of its crypto treasury—essentially, investors are getting the ETH exposure “on sale.” Ethereum (ETH) is trading around $2,730 as of November 21, 2025, near multi-month lows after a broader crypto selloff.

This has compressed valuations across ETH-treasury firms: the sector’s combined market cap fell from $176 billion in July to ~$99 billion today. BitMine, the world’s largest public ETH treasury aiming for 5% of total ETH supply, holds ~3.4 million ETH but faces significant unrealized losses.

Similar pressures hit peers like Strategy, the largest overall crypto treasury. Recent capital raises > $10 billion for ETH buys have left equity holders exposed in this downturn. The modest $0.01 payout signals a shift toward traditional value-return mechanisms, aiming to attract conservative investors, boost shareholder loyalty, and signal confidence amid volatility.

Tom Lee emphasized BitMine’s positioning for 2026, noting the dividend reflects “commitment to create shareholder value.”
BitMine plans to roll out its “Made in America Validator Network” (MAVAN) in Q1 2026—a U.S.-based Ethereum staking infrastructure.

This will generate yield on its ETH holdings potentially 3-5% APY, diversifying beyond accumulation. A pilot with top providers (e.g., via partnerships) is underway. The firm continues Bitcoin mining in Trinidad and Texas, blending it with its ETH focus.

Supported by heavyweights like ARK Invest’s Cathie Wood, DCG, Founders Fund, Galaxy Digital, Pantera Capital, Kraken, Bill Miller III, and Tom Lee himself. BMNR shares ticked up modestly on the announcement but remain volatile, reflecting the sector’s ~50% drop in the past 30 days.

Despite the pressures, Lee has urged “buy the dip” on ETH, citing record U.S. equity ETF inflows ~$47+ billion as a bullish signal for risk assets. He views the mNAV compression as a buying opportunity, with staking set to enhance returns.

Sustainability of the dividend hinges on ETH recovery; prolonged weakness could strain payouts. Forward-looking elements (e.g., 5% ETH goal, staking yields) depend on market conditions and tech execution. BitMine’s annual shareholder meeting is scheduled for January 15, 2026, at the Wynn Las Vegas.

This development underscores the maturation of crypto treasuries, blending yield strategies with traditional finance tools.

A Look Into US Investigation into Bitmain Over Rising Energy Consumption

The Bloomberg report, reveals a federal probe into Bitmain Technologies Ltd., the Beijing-based company that dominates the global Bitcoin mining hardware market producing the majority of the world’s ASIC miners.

The investigation, internally dubbed “Operation Red Sunset,” is led by the Department of Homeland Security (DHS) with involvement from the National Security Council. It spans the late Biden administration and into the early Trump term, focusing on whether Bitmain’s machines could be exploited for espionage, remote sabotage, or disruptions to the US power grid.

The probe gained urgency last year after Bitmain equipment was installed at a mining site near a US military base, prompting “significant national security concerns” in a federal review. A July 2025 Senate Intelligence Committee document highlighted “several disturbing vulnerabilities,” including the potential for remote control from China.

This echoes past actions, such as the 2019 scrutiny of Chinese mining firms and a May 2024 Biden-era block on a crypto mining facility near a Wyoming nuclear missile base due to foreign equipment risks. The Committee on Foreign Investment in the United States (CFIUS) has warned that such devices near sensitive sites could enable surveillance.

Authorities seized Bitmain hardware imports starting last autumn held by US Customs and Border Protection until March 2025. In some instances, officials disassembled ASICs to inspect chips and code for malicious features. The inquiry also touched on possible tariff and import violations.

Trump Family Connection

The timing has amplified political scrutiny, as American Bitcoin—a mining venture backed by Donald Trump Jr. and Eric Trump—purchased 16,000 Bitmain machines in August 2025 for $314 million (paid in Bitcoin). The company plans to deploy 76,000 such rigs across the US and Canada.

A spokesperson for American Bitcoin emphasized rigorous security testing, stating no remote access vulnerabilities were found and that the firm prioritizes “national security, grid stability, and operational security.”

Bitmain categorically denies the allegations, calling claims of remote control “unequivocally false.” The company asserts it “strictly complies with U.S. and applicable laws and regulations,” has “no connection to the Chinese government,” and is unaware of the probe. It attributes prior hardware detentions to unrelated FCC issues, with “nothing out of the ordinary” discovered.

DHS has declined to comment on the “open and active” investigation, and no findings have been publicly disclosed. The probe’s outcome remains unclear, but it underscores US-China tensions in critical tech sectors, including crypto mining.

With Chinese firms like Bitmain holding ~80% market share, potential restrictions could disrupt US miners, spurring calls for domestic alternatives though none yet compete effectively. GOP Rep. Zach Nunn has urged CFIUS to review foreign mining chips more broadly.

ForkLog highlighted the probe as a “potential threat to national security.” Nexus News AI summarized it as a risk over “alleged remote capabilities.” This development could influence Bitcoin mining’s US footprint, especially amid rising energy demands and geopolitical strains.

US miners, heavily reliant on Bitmain’s Antminer series, face heightened risks of import delays, seizures, or outright bans. Earlier this year, US Customs and Border Protection already detained thousands of Bitmain ASICs, causing operational halts for some firms.

If restrictions expand, hashrate distribution could shift, temporarily reducing US mining capacity and increasing costs by 20-50% as operators pivot to pricier alternatives. Mining rigs consume massive electricity up to 3,000W per unit, and concerns over remote sabotage could lead to stricter siting rules—prohibiting deployments near power plants or military sites.

This echoes the May 2024 Biden-era block on a Wyoming facility near a nuclear base. GOP Rep. Zach Nunn has called for broader CFIUS reviews of foreign chips, potentially delaying expansions amid rising US energy demands from AI and crypto.

American Bitcoin’s $314 million purchase of 16,000 Bitmain rigs for deployment across the US and Canada has politicized the issue. While the firm claims “rigorous security testing” found no vulnerabilities, any adverse findings could embarrass the Trump-backed venture, forcing a costly hardware swap and eroding investor confidence in “America-first” crypto initiatives.

LeverageShares to Launch Europe’s First 3x Leveraged Bitcoin and Ether ETFs

By
Paul Ugbede Godwin
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0

Asset manager LeverageShares announced plans to debut the world’s first 3x and -3x leveraged exchange-traded products (ETPs/ETFs) tracking Bitcoin (BTC) and Ethereum (ETH) in Europe, with listings expected on Switzerland’s SIX exchange as early as next week.

This move marks a significant expansion of leveraged crypto exposure in the region, building on LeverageShares’ existing suite of high-risk ETPs covering sectors like semiconductors, AI, and blue-chip stocks.

These ETPs aim to deliver three times (3x) the daily performance of BTC and ETH for long positions, or three times the inverse (-3x) for short positions, allowing investors to speculate on both upward and downward price movements without directly holding the cryptocurrencies.

The four products include: 3x Long Bitcoin ETP, -3x Short Bitcoin ETP, 3x Long Ether ETP and -3x Short Ether ETP. They will be available to European retail and institutional investors, subject to final regulatory nods, and are designed for short-term trading due to the compounding effects of daily leverage, which can amplify both gains and losses.

The timing of this launch is striking, coinciding with intense market volatility and a record retail exodus from spot crypto ETFs. In November 2025 alone, investors have pulled approximately $4 billion from U.S. spot Bitcoin and Ether ETFs—surpassing February’s previous record outflows—driven by broader economic pressures and waning enthusiasm for high-risk assets.

Crypto prices have tumbled sharply: Bitcoin has dropped ~35% from its early-October all-time high above $126,000, recently testing support below $80,000. Ether has fallen over 43% in the same period, exacerbating losses in the altcoin sector.

In contrast, traditional equity ETFs have seen inflows of ~$96 billion this month, including into leveraged stock products, highlighting a flight to perceived safer assets like the S&P 500 down just 5% from its October peak.

Analysts note that while this selloff creates a “buy low” opportunity for contrarians, the introduction of 3x leveraged tools could heighten speculation during an already turbulent phase.

Europe’s regulatory environment has been more crypto-friendly than the U.S. in recent years, enabling innovations like these ETPs ahead of potential SEC approvals for similar U.S. products (e.g., Defiance’s proposed 3x funds targeting crypto-related stocks).

However, experts emphasize the high risks: Leveraged ETPs are not suitable for buy-and-hold strategies, as daily resets can lead to significant decay in volatile markets. LeverageShares has stressed the need for investor education and risk safeguards.

Early reactions on X (formerly Twitter) are buzzing, with posts highlighting the “breaking” nature of the news and its potential to draw speculative interest despite the downturn.

This development underscores the crypto market’s resilience in product innovation, even as prices reel—potentially signaling a pivot toward sophisticated hedging tools for European traders.

Leveraged ETFs like the new 3x Bitcoin and 3x Ether ETPs from LeverageShares are powerful but extremely dangerous tools for most investors. They are designed to deliver a multiple (2x, 3x, etc.) of the daily performance of an underlying asset, not the long-term performance.

This daily reset creates several unique and often misunderstood risks. Because leveraged ETFs reset every single day, their long-term returns can deviate dramatically from the simple multiple of the underlying asset—especially in volatile markets.

Example with numbers 3x Bitcoin ETF, suppose Bitcoin does this over three days: Day 1: +10% ? 3x ETF = +30%. Day 2: –9.09% back to original price ? 3x ETF = –27.27%. Day 3: +10% again Bitcoin now flat over 3 days. Bitcoin ends exactly where it started 0% return, but the 3x ETF is down ~13%:

(1 + 0.30) × (1 – 0.2727) × (1 + 0.30) – 1 = –13%. The more volatile the asset and the longer you hold, the worse this decay becomes. Crypto is already one of the most volatile asset classes—3x leverage on it is decay on steroids.2. Losses are magnified much faster than gains.

A 33.4% drop in Bitcoin wipes out a 3x long ETF completely 3 × –33.4% = –100%. A 50% drop in Bitcoin turns a –3x short ETF into a total loss.3. Not suitable for holding longer than one day. The issuers (ProShares, Direxion, LeverageShares, etc.) explicitly state these products are for daily use only.

Most retail investors ignore this and treat them like normal ETFs, leading to catastrophic losses over weeks or months.4. Higher expense ratios and tracking costsLeveraged ETFs use swaps, futures, or daily borrowing, which is expensive.

Typical fees are 0.95%–1.5% per year—far higher than normal ETFs—eating returns even in flat markets.5. Forced liquidations in extreme movesSome leveraged products have termination events. If the underlying moves too much in one day (e.g., Bitcoin drops 25–30% in hours), the ETF can hit its leverage limit and be forced to liquidate, locking in permanent losses for holders.

Psychological and behavioral riskThe huge daily swings encourage emotional trading, over-trading, and revenge trading—exactly the opposite of what wins in investing. Real-world historical examples XXBT a former 2x Bitcoin ETP in Europe: lost >99% of its value from 2021 to 2023 despite Bitcoin only being down ~30% from its peak at the worst point.

UVXY 2x VIX futures is down >99.999% since inception in 2011, even though the VIX itself still exists. Bottom line – Who should use them? Almost nobody who is a normal retail investor. They can be useful for professional day traders hedging a specific short-term view.

Very sophisticated investors who actively monitor and rebalance daily. For 99% of people, 3x leveraged crypto ETPs are financial landmines with a shiny “get rich quick” wrapper. If you wouldn’t be comfortable losing your entire position in a single week or day, stay far away.

Ifo Institute Notes That 8% of German Companies Are Currently in “Critical Situation”

By
Paul Ugbede Godwin
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0

A recent survey conducted by the Munich-based Ifo Institute, reveals that approximately 8% of German companies are currently in a ‘critical situation’, where they fear for their very existence.

This marks a slight increase from 7.3% in October 2024, indicating growing economic pressures amid Germany’s ongoing recession. 8.1% of firms reported fearing for their survival, up from the previous year.

The survey highlights deteriorating sentiment, with many companies citing high energy costs, supply chain disruptions, and weak global demand as major factors. Manufacturing and export-oriented industries are hit hardest, aligning with Germany’s broader economic contraction GDP shrank 0.3% in 2023 and shows no strong rebound in 2025.

This data is part of the ifo Business Climate Index, which polls thousands of German executives monthly on their assessments of current conditions and future expectations. Germany has been grappling with a prolonged crisis since 2022, exacerbated by the energy shock from the Russia-Ukraine war, inflation peaking at 8% in 2022, and intense competition from Chinese manufacturers in sectors like automotive and renewables.

Only 25.8% of companies report being hampered by lack of skilled workers, the lowest in three years, though this remains a drag on growth. Unions like IG Metall have seen membership drop 8% since 2016, amid rising disputes over job cuts in auto giants like Volkswagen planning 35,000 layoffs by 2030.

27% of firms anticipate AI leading to an average 8% headcount reduction over the next five years, particularly in industry. 90% of organizations face shortages in security roles, heightening risks in a tense geopolitical environment.

ifo President Clemens Fuest described the economy as “increasingly falling into crisis,” urging structural reforms to boost competitiveness. While not all sectors are equally affected—services show some resilience—the overall outlook remains cautious, with forecasts for mild contraction in 2025.

Germany’s manufacturing sector, which accounts for about 19-20% of GDP and employs roughly 7 million people, is bearing the brunt of the broader economic challenges highlighted in the ifo Institute’s November 2025 survey.

While the overall figure of 8.1% of companies in a “critical situation” fearing for their existence applies economy-wide, manufacturing firms are disproportionately affected, with estimates suggesting 10-15% in severe distress due to export dependency and structural vulnerabilities.

This sector has seen output decline by over 12% from its February 2023 peak, marking the deepest contraction since the 2008 financial crisis. The manufacturing downturn is driven by a mix of cyclical and structural factors, exacerbating the recession that began in 2022

Sharp drop in industrial output, with no rebound in sight. Energy-intensive subsectors (e.g., chemicals, metals) hit hardest. August 2025: -4.5% monthly decline largest in 3+ years. Annual contraction: 2.0% in 2024, projected 1-2% further drop in 2025.

ifo Business Climate Index for manufacturing at multi-year lows, with pessimistic outlooks dominating. November 2025: Worsened due to order shortages; capacity utilization at 78.2% vs. 83.3% long-term average.

Resurgent shortages in semiconductors, rare earths, and electronics, amid geopolitical tensions. Affects auto, machinery, and green-tech; tied to China export restrictions. Rising layoffs and furloughs, despite slight easing in skilled worker shortages.

DIHK Survey: 30% of industrial firms cutting staff in 2025; only 11% hiring. Volkswagen’s 35,000 job cuts by 2030 accelerated; overall sector risks 100,000+ losses. Weak foreign demand, especially from China; post-pandemic shift from goods to services hurts exporters.

Exports down 4.5% in past 6 months; China sales for autos fell 20-30%. Automotive and machinery lead declines; EVs offer some offset but lag in adoption. <4 million units in 2024 from 5.6M in 2017; further drop projected. Major output falls; pharma and electronics also down sharply.

Post-Russia-Ukraine war, gas prices remain 2-3x pre-2022 levels, eroding competitiveness in energy-intensive industries (e.g., chemicals down 10-15%). This has led to “creeping deindustrialization,” with firms relocating to the US or Asia for cheaper energy.

China’s “Made in China 2025” initiative has flooded markets with low-cost EVs and machinery, capturing 30%+ of Germany’s traditional auto export share. US tariff threats under a potential Trump administration add risks, potentially costing €10-20B in exports.

High bureaucracy €65B annual compliance cost, aging workforce; 700,000+ vacancies, and stagnant productivity down 0.5% annually stifle investment. Public infrastructure underinvestment near OECD bottom compounds this.

ifo President Clemens Fuest warns of a “structural crisis” in manufacturing, with investment reluctance deepening the slump. While services show resilience, the sector’s woes risk spilling over to neighbors like Austria and the Netherlands via supply chains.

Forecasts point to 0.1-0.5% GDP contraction in 2025, with manufacturing dragging growth to near-zero or negative. Recovery hinges on ECB rate cuts, US-China trade stabilization, and domestic reforms like deregulation and energy subsidies.

Firms are adapting via “China-for-China” strategies like VW’s local EV partnerships, but this risks IP leakage. Long-term, boosting R&D in AI and green tech could offset losses, though experts like the BDI call for radical steps to avert the longest postwar downturn.

AI Data Centers Contributions to U.S. GDP Growth Outpace U.S. Consumer Spending 

By
Paul Ugbede Godwin
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0

In recent economic analysis. Harvard economist Jason Furman crunched the numbers from U.S. Bureau of Economic Analysis data and found that investments in information-processing equipment and software largely tied to AI data centers made up just 4% of total U.S. GDP in the first half of 2025.

Yet, those same investments drove roughly 92% of the period’s GDP growth. Excluding them, annualized GDP growth would have limped along at a mere 0.1%—a virtual standstill that economists often flag as recession territory, especially amid slowing job growth and weakness in consumer spending, manufacturing, and services.

The surge stems from massive capital expenditures by Big Tech on AI infrastructure scale of spending. Companies like Microsoft, Google (Alphabet), Meta, and Amazon poured nearly $370 billion into capex in 2025 alone, much of it on servers, GPUs, and data center builds.

Goldman Sachs estimates global AI-related spend hit $200 billion this year, with U.S. data center construction reaching a record $40 billion annualized rate in mid-2025. This isn’t just hardware—it’s software, R&D, and power/grid upgrades too.

Renaissance Macro Research noted in August that AI data center contributions to GDP growth outpaced U.S. consumer spending typically ~70% of GDP for the first time ever. Other sectors dragged: Manufacturing and real estate saw outright declines.

Retail and services added little, with job creation cooling sharply, unemployment claims hit a 4-year high in recent months. Consumer credit is flashing yellow delinquencies rising, and without the tech boom, the Federal Reserve might have cut rates further to stave off contraction—potentially averting recession but risking higher inflation elsewhere.

S&P Global pegs data centers and high-tech as responsible for ~80% of private domestic demand growth in H1 2025; without it, the economy flatlines. It’s a classic “jobless recovery” vibe: GDP looks robust Q3 now tracking 4.2% annualized per Atlanta Fed, but the gains are K-shaped—concentrated in tech hubs and elite firms, not broadly shared.

Data centers employ few ongoing workers mostly construction-phase jobs, limit wage-driven consumption spillovers, and strain resources—electricity demand could double by 2028, driving up bills 6-7% yearly and emissions already 2% of U.S. total.

Morningstar warns AI capex now exceeds the dot-com peak relative to GDP, needing $2 trillion in annual revenue by 2030 to justify current: ~$20 billion. Bubble fears are real—53% of investors see one brewing.

Furman himself notes that absent the AI boom, we’d likely see lower rates and energy costs, spurring ~half the lost growth elsewhere. The data center boom is a lifeline keeping recession at bay, but it’s propping up a patient with underlying issues.

The energy crunch is reshaping the AI and tech economy in profound ways, turning what was once a frictionless growth story into a high-stakes balancing act. Data center power demand is projected to more than double globally to 945 TWh by 2030—equivalent to Japan’s entire electricity consumption today—with AI driving the lion’s share.

In the US, this could translate to an 8% average rise in household electricity bills by 2030, spiking to 25% in hotspots like Virginia. Wholesale prices near data centers have already jumped up to 267% since 2020, fueling $9.3 billion in capacity cost hikes in markets like PJM.

For Big Tech, $800 billion in 2025 data center commitments from Alphabet, Amazon, Meta, Microsoft, and OpenAI risk ballooning into capex overruns if grid delays persist, potentially delaying ROI and throttling the $370 billion hyperscaler spend.

On the flip side, this scarcity is birthing a $580 billion global data center market by 2025, with AI claiming 27% share by 2027, redirecting trillions toward infrastructure. Utilities are filing for $30 billion in rate hikes, but the real winner? A projected 36 GW US power shortfall by 2028, sparking M&A and investments in everything from natural gas to batteries.

Without mitigations, this could shave 1-2% off US GDP growth annually through blackouts and higher costs, per RAND estimates. Markets are pivoting hard: chip stocks like Nvidia may face “power-limited” ceilings, with Jensen Huang warning of electricity as the new bottleneck—data centers could hit 40% of net new US demand by 2030.

Utility and energy plays are surging—Constellation Energy (CEG) up 50% YTD on nuclear restarts, while renewables like NextEra (NEE) and battery firms (e.g., Fluence, FLNC) eye 23% CAGR in storage needs.

But speculation is rife: Sam Altman called out an “AI bubble” in August, and utilities like Constellation are tempering hype, warning of overstated loads. Geopolitically, China’s edge in manufacturing and energy could erode US AI leadership if transformers and generation lag—Elon Musk flagged this as a “worrying” long-term risk.

AI infra stocks could dip 20-30% on permitting snarls, but energy innovators SMRs, advanced solar might 5x as demand quadruples to 1,600 TWh by 2035. If AI delivers transformative productivity as optimists bet, it could broaden out. If not, we’re borrowing from tomorrow’s growth today.

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