CoinDesk
AI infrastructure stocks fell further as Democratic election victories raised fears of tighter limits on data center construction. The sector is already down roughly 50% to 60% from its summer highs, and Texas Democrat Gina Hinojosa’s projected victory sharpened investor focus on the risk of a moratorium.
Why it matters
Texas accounts for 27% of planned U.S. data center power capacity, according to Wells Fargo estimates. Hinojosa supports a moratorium on AI data centers, putting a major source of planned capacity in the political spotlight as the sector contends with concerns about construction restrictions.
Elon Musk suggested that data centers in space look appealing, while investor Chamath Palihapitiya highlighted the space economy. His research put private investment in space hardware at about $17 billion in 2025, up from $500 million in 2012. The discussion points to an alternative setting for infrastructure, but the seed does not establish that space facilities can replace planned terrestrial capacity.
Market impact
CoreWeave and Applied Digital fell about 3.3% and 3%, respectively, in early trading, while IREN dropped 4.3% ahead of Wednesday’s open. The declines came as investors weighed political risk against the sector’s construction needs.
Broader stock futures later recovered from initial losses, with Invesco QQQ tech futures up 0.3% pre-market. Bitcoin traded above $78,000, up more than 1% over the prior 24 hours, showing a different move from the AI infrastructure shares. Investors will be watching whether data center restrictions advance and how companies respond to constraints on new capacity.
Frequently asked questions
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Why are Texas election results relevant to AI infrastructure investors?
Texas accounts for 27% of planned U.S. data center power capacity. Gina Hinojosa supports a moratorium on AI data centers, raising concern about potential construction limits.
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How far have AI infrastructure stocks fallen from their summer highs?
The sector is down roughly 50% to 60% from its summer highs.
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How did CoreWeave, Applied Digital and IREN trade?
CoreWeave fell about 3.3%, Applied Digital about 3%, and IREN 4.3% ahead of Wednesday’s open.
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What did Elon Musk say about data centers in space?
Musk wrote that data centers in space were looking appealing as election results raised concerns about the future of U.S. AI infrastructure.
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How much private investment went into space hardware in 2025?
Chamath Palihapitiya’s research put private investment in space hardware at approximately $17 billion in 2025, compared with $500 million in 2012.
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