Swedish authorities raided Northern Data offices in Frankfurt and Boden after the European AI cloud firm received a tax break worth approximately 100 million euros on Nvidia H100 chips, which were valued at 400 million euros. Investigators allege the company used artificial intelligence accelerators for cryptocurrency mining rather than AI computing workloads. Northern Data previously marketed itself as an environmentally friendly Bitcoin mining operation before rebranding as an AI cloud provider.
The firm is backed by stablecoin company Tether. Arrests followed the raids, and officials disclosed what they describe as significant value-added tax fraud. AI chips remain poorly suited for cryptocurrency algorithms, but analysts suggest Northern Data may have pursued the purchase to capitalize on substantial tax incentives that represented a large portion of the chip acquisition costs.
The firm is backed by stablecoin company Tether. Arrests followed the raids, and officials disclosed what they describe as significant value-added tax fraud. AI chips remain poorly suited for cryptocurrency algorithms, but analysts suggest Northern Data may have pursued the purchase to capitalize on substantial tax incentives that represented a large portion of the chip acquisition costs.
