Alset Capital Inc. is a publicly traded company: OTC:ALSCF | TSXV:KSUM | FSE:1R60

There's Not Enough Power for America's High-Tech Ambitions

There’s Not Enough Power for America’s High-Tech Ambitions: How Do We Keep Up and Remain Relevant in the AI Arms Race?

The United States is at a critical juncture in the global AI arms race, facing a severe shortage of computing power necessary to fuel the next wave of technological advancements. The rapid development of artificial intelligence technologies, particularly generative AI models like ChatGPT, is driving an unprecedented demand for the specialized chips and data center infrastructure required to train and operate these sophisticated systems. Without addressing this crunch, America’s high-tech ambitions may be significantly hampered.

The Computing Power Crunch:

According to the International Energy Agency, data centers already consume 4% of total US electricity, a figure projected to rise substantially by 2026 as AI workloads grow exponentially. To put this into perspective, a single ChatGPT-like model requires the power equivalent of 80,000 households. Major chip manufacturers like Nvidia are struggling to keep up with the demand for their AI-optimized GPUs, as startups and tech giants vie for limited supply.

This shortage coincides with a surge in AI development and clean-tech manufacturing driven by the Biden administration’s industrial policy and the USD $39 billion CHIPS Act passed in 2022. Despite over 50 new semiconductor fab projects being announced, labor shortages and competition for scarce power capacity pose significant challenges.

The Growing Energy Demand:

Generative AI alone could consume 10% of the world’s electricity by 2030. However, upgrading the power grid to meet this demand takes years, pushing data centers to build their own power plants or turn to off-grid solutions like fuel cells. Startups are pooling resources and optimizing their models to extract maximum performance from older hardware. Meanwhile, China is rapidly catching up after the US initially took the lead with technologies like ChatGPT, seeing AI as crucial for its future economic and military competitiveness.

The Urgency of a Comprehensive Strategy:

To maintain its leadership in AI, the US urgently needs a comprehensive strategy to bolster its AI infrastructure. This includes expanding domestic chip production, securing supply chains, upgrading the power grid, improving data center efficiency, accelerating R&D in next-gen computing technologies, training more skilled workers, and fostering public-private partnerships to pool compute resources for researchers and startups.

Enter Alset Capital:

The U.S and Canada have been leaders in the AI and deep learning space since the 1990s, thanks to pioneers like Yoshua Bengio and Geoffrey Hinton. However, despite Canada ranking fifth globally for AI capacity, its AI infrastructure ranks 23rd. Companies like ourselves at Alset Capital Inc. (OTC:ALSCF) (TSXV:KSUM) (FSE:1R60) are working to sustain and enhance this lead.

Ourselves  through our investee Cedarcross International Technologies (Cedarcross), are aiming to provide the necessary computing capabilities to keep the  AI ecosystem thriving. Cedarcross owns and operates some of the world’s most advanced GPU hardware, leveraging NVIDIA’s industry-leading H100 GPUs to offer scalable AI resources to enterprise clients in real time.

Alset Capital's Strategic Moves:

Our strategic initiatives are well-aligned with the growing demand for AI computing. Cedarcross recently secured a two-year AI Computing leasing agreement expected to generate USD $4.0 million with an 80% gross margin. Another significant milestone is a deal with Ceti AI for the sale of Nvidia H100 HGX 8GPU servers, projected to generate approximately USD $1.68 million in gross revenue.

Moreover, Cedarcross has a distribution deal with Earthmade Computer Inc., an authorized distributor of Super Micro Computer Inc., which enhances market power and provides competitive pricing and superior delivery timelines for Nvidia GPU HPC servers. This positions Cedarcross to meet the growing demand for high-performance AI computing solutions.

Expanding Market Presence and Revenue:

Cedarcross continues to expand its market presence through strategic partnerships and distribution agreements, further solidifying its position as a leader in AI infrastructure. The Canadian government’s recent commitment to invest CAD $2.4 billion in the AI sector underscores the critical importance of AI computing in driving technological innovation and economic growth. The stakes in the AI arms race are incredibly high. As the US grapples with a computing power shortage, ourselves along side Cedarcross are stepping up to provide the necessary infrastructure to keep pace with global AI advancements. We believe that our visionary investment strategy and robust revenue models not only secure the US and Canada’s future in AI but also offer significant value growth for shareholders.

According to the International Energy Agency, data centers already consume 4% of total US electricity, a figure projected to rise substantially by 2026 as AI workloads grow exponentially. To put this into perspective, a single ChatGPT-like model requires the power equivalent of 80,000 households. Major chip manufacturers like Nvidia are struggling to keep up with the demand for their AI-optimized GPUs, as startups and tech giants vie for limited supply.

This shortage coincides with a surge in AI development and clean-tech manufacturing driven by the Biden administration’s industrial policy and the USD $39 billion CHIPS Act passed in 2022. Despite over 50 new semiconductor fab projects being announced, labor shortages and competition for scarce power capacity pose significant challenges.

1 Stephen Tusa, Jr., et al., JP Morgan Research Note, 29 February 2024.

2 Pranay Ahlawat, et al., “A New Architecture to Manage Data Costs and Complexity,” Boston Consulting Group, February 2023.

3 International Energy Agency, “Electricity 2024 Report,” January 2024.

4 Srini Bangalore. et al., “Investing in the rising data center economy,” McKinsey & Company, 17 January 2023.

5 International Energy Agency, “Electricity 2024 Report,” January 2024.

6 Statista.com; EIA Monthly Energy Review

7 Cloudscene via Statista, as of September 2023.

8 A. Wilson, “Datacenter companies continue renewable buying spree, surpassing 40 GW in US, S&P Global,” 28 March 2023.

9 International Energy Agency, “Electricity 2024 Report,” January 2024.

10 T. Lenoir, “US Interconnection Queues Analysis 2023,” S&P Global, 28 August 2023.

11 International Energy Agency, “Electricity 2024 Report”, January 2024.

This website page may include forward-looking information and forward-looking statements (collectively, the “forward-looking information”) with respect to Alset Capital Inc. (the “Company”). Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives, assumptions or future events or performance (often, but not always, using words or phrases including, but not limited to, “expects”, “does not expect”, “is expected”, “anticipates”, “does not anticipate”, “plans”, “estimates”, “believes”, “does not believe” or “intends”, or stating that certain actions, events or results may, could, would, might or will be taken, occur or be achieved) are not statements of historical fact and may be “forward-looking information”. This information represents predictions and actual events or results may differ materially. Information on this website page is current and of May 16, 2024, except as otherwise provided herein and the Company does not undertake or agree to update this website page after the date hereof

Forward-looking information may relate to the Company’s future outlook and anticipated events or results and may include statements regarding respective financial results, future financial position, expected growth of cash flows, business and marketing strategy, budgets, anticipated timeline for completion of acquisitions or development of assets, projected costs, projected capital expenditures, taxes, plans, industry trends and growth opportunities. Any forward-looking information contained on this page is based on certain assumptions regarding expected growth, results of operations, performance, industry trends and growth opportunities, which in the opinion of management of the Company are reasonable.

While management of the Company considers these assumptions to be reasonable, based on information available, they may prove to be incorrect. Forward-looking information involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by the forward-looking information. These risks, uncertainties and other factors include, but are not limited to: (i) the willingness and ability of third parties to honor their contractual obligations; (ii) the decisions of third parties over which the Company has no control; (iii) environmental and government regulations; (iv) availability of financing as needed by the Company; (v) judicial proceedings; (vi) force majeure events; (vii) risks associated with the Company’s ability to meet historic sales performances; (viii) its ability to implement and fulfill its business strategies; (ix) general economic conditions; (x) adverse industry events; (xi) marketing costs; (xii) loss of markets; (xiii) future legislative and regulatory developments; (xiv) inability to access sufficient capital from internal and external sources, and/or inability to access sufficient capital on favourable terms; (xv) income tax and regulatory matters; (xvi) the ability of the Company to implement its business strategies including expansion plans; (xvii) competition; and (xviii) changes in regulation. The foregoing factors are not intended to be exhaustive. Additional risks associated with this forward looking information include that the transactions with Earthmade Computer Inc., and the AI computing leasing agreement may not occur as contemplated or at all.

 

Although Company has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking information, there may be other factors that cause actions, events or results to differ from those anticipated, estimated or intended. Any forward-looking information contained on this page is current only as of the date such information is posted and the the Company and its directors, agents, officers and employees, as applicable, disclaim any obligation to update any forward-looking information, whether as a result of new information, future events or results or otherwise. There can be no assurance that forward-looking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, users of this site should not place undue reliance on forward-looking information due to the inherent uncertainty therein.