Northern Data under criminal investigation over €500m GPU purchases

Northern Data AG, a Frankfurt‑listed firm historically known for its Bitcoin mining operations, is under criminal investigation by European prosecutors over the alleged misuse of nearly €500 million worth of GPUs and suspected VAT fraud exceeding €100 million. The investigations span Germany and Sweden, and have already resulted in four arrests.

Authorities suspect that high‑end NVIDIA GPUs were procured under the premise of supporting artificial intelligence (AI) and cloud computing infrastructure, uses that qualify for favourable tax treatment—while instead being deployed for cryptocurrency mining, particularly in Northern Data’s Boden site in northern Sweden. Prosecutors are examining whether the company or its subsidiaries misrepresented the intended use of the GPUs to benefit from VAT exemptions and other tax incentives.

Raids were conducted by the German Federal Criminal Police and Sweden’s Economic Crime Authority, with support from local tax crime units. According to official statements and media reports, the investigation focuses on activities between 2021 and 2024. Four individuals were arrested in Sweden in late September in connection with the case. Northern Data has publicly stated it is cooperating with authorities and insists that its GPU infrastructure is used solely for cloud computing.

The probe arrives at a pivotal moment for the company. Northern Data is reportedly planning a U.S. IPO in the first half of 2025, targeting a valuation between US$10 billion and US$16 billion for its AI and cloud computing divisions, Taiga and Ardent. The firm has been actively repositioning itself away from pure Bitcoin mining towards broader high‑performance computing services.

For Bitcoin and sound‑money observers, the case is emblematic of the complex regulatory environment miners now face, particularly as they scale infrastructure that blurs the line between AI and hash‑rate monetisation. It also raises deeper questions about subsidy regimes and the correct classification of computing resources in jurisdictions offering preferential tax treatment for AI development.

With the investigation ongoing, Northern Data has withdrawn its 2025 financial guidance and is undergoing a strategic review. The outcome of the probe could set precedent for how regulators globally treat crypto‑adjacent infrastructure in an era of expanding state scrutiny and tightening financial controls.