CoreWeave CDS Pricing Implies 63% Five-Year Default Probability

Credit default swap pricing for CoreWeave implies a 63% probability of default within five years, while widening spreads for Oracle and SoftBank point to higher perceived risk among AI-related borrowers. A credit default swap, or CDS, is a contract that provides protection against a borrower’s default. Its spread measures the cost of that protection. When the spread widens, the market is pricing in more credit risk, but that pricing does not establish that a borrower will default. The companies’ exposure to AI infrastructure spending comes with different levels of cash and debt.

Source: TokenPost