Markets Underestimate Private-Credit Risk and the Collateral Value of AI Infrastructure

The rapid rise of generative artificial intelligence threatens to disrupt the traditional software industry, testing private-credit funds with large investments in software companies. Private credit has traditionally been viewed as a speculative investment. But the market has yet to distinguish clearly between software debt exposed to AI disruption and newer forms of credit backed by physical AI infrastructure, leading it to continue misjudging private-credit risk.

According to a July 16, 2026, report by American Banker, Blue Owl's $36 billion flagship credit fund faced heavy redemptions in the first quarter of 2026. Investors were alarmed that its software exposure could be vulnerable to AI disruption. At the same time, the market underestimated the tangible value of AI hardware infrastructure as a new form of collateral, leaving credit risk persistently mispriced.