The world's fastest traders are becoming some of the biggest spenders in AI. High-frequency trading firms such as Jane Street and Hudson River Trading are pouring money into AI and chip startups, signing massive cloud contracts and building their own data centers, Bloomberg reports.
The reason is simple: these firms increasingly rely on machine learning to predict market moves. One executive estimates that compute spending is now ten to twenty times higher than it was before ChatGPT launched.
Jane Street's $7 billion AI bet
Jane Street has taken the most direct route into the AI economy. The firm invested $1 billion directly in CoreWeave and committed $6 billion to its computing services, according to Bloomberg. It also runs its own data center in Texas with more than 4,000 Nvidia GPUs.
Beyond infrastructure, Jane Street is backing silicon. The firm led a funding round for chip startup Etched and became the first customer for its AI chip, which is designed to deliver more performance by running at a lower voltage.
Hudson River Trading is following a similar logic through cloud deals instead. According to AI chief Iain Dunning, the firm spends $1 billion a year on AI and has signed a multiyear agreement with CoreWeave.
TXt Markets data center and the race for compute
The race is not limited to the two largest players. XTX Markets is building a data center in Finland, while other trading firms are locking in cloud capacity before prices rise further.
Rising costs and fast-aging chips are widely seen as real risks, according to Bloomberg. Even so, executives like Jan Boomaars, CEO of Amsterdam-based high-frequency trader Optiver, argue that doing nothing is the more dangerous option.
