OpenAI offers private equity firms a 17.5% minimum return guarantee on new joint ventures. This prompted comparisons to the Terra Luna collapse from cryptocurrency industry leaders and Wall Street veterans.
Nansen CEO Alex Svanevik and former BlackRock portfolio manager Edward Dowd question the sustainability of the structure.
Why did the 17.5% floor sound the alarm?
According to Reuters, the deals include companies including TPG, Advent International, Bain Capital and Brookfield Asset Management.
Both companies will receive approximately $10 billion worth of preferred stock in the joint venture, with the PE firm contributing approximately $4 billion.
OpenAI added a guaranteed 17.5% floor return and early access to unreleased AI models to help close deals. This interest rate is significantly higher than typical preferred stock products.
OpenAI offers PE firms a minimum of 17.5% preferred return
OpenAI is in talks to form joint ventures with PE firms like TPG and Advent to deploy AI models across its portfolio companies
— WallStRollup (@WallStRollup) March 23, 2026
The announcement comes as the company’s 2026 losses are projected to reach $14 billion, according to an internal document reported by the Information.
OpenAI’s annual revenue run rate will reach $20 billion by the end of 2025, a 233% year-over-year increase, but expenses still exceed revenue.
Skepticism is not limited to social media. At least two private equity firms have declined to participate in OpenAI or Anthropic joint ventures, citing concerns about economics and profitability.
Thoma Bravo, one of the world’s largest software-focused buyout firms, is exiting after its managing partner Orlando Bravo questioned the long-term benefits of an AI joint venture. They pointed out that many of their portfolio companies are already implementing AI tools without investing in venture capital.
Thoma Bravo giving away an open night is private equity and it’s like a smart friend saying, “No, I’m fine.”
— Evil Cass (@evilcassieroll) March 23, 2026
Terra Luna comparison
Nansen CEO Alex Svanevik likened the 17.5% figure to the collapse of the Terra ecosystem in May 2022.
“We are in the Terra Luna stage of OpenAI,” said Alex Svanevik.
Anchor Protocol, the core yield engine of the Terra network, offered depositors approximately 19% to 20% on its algorithmic stablecoin UST.
“…a decentralized financial market offering a stable 20% APY to depositors…” reads an excerpt from a Medium post at the time.
As confidence crumbled and withdrawals skyrocketed, UST lost its peg. LUNA hyperinflation. More than $40 billion in value disappeared within days.
The structural similarities are tangible.
- Guaranteed above-market yields in both cases
- Provided by companies that spend far more than they earn
- A continuous inflow of capital is required to sustain the business.
From a cryptocurrency perspective, guaranteed yields and large losses have historically preceded systemic stress.
“Very expensive capital…It’s a cry of despair. Nothing screams bubble trouble more than that,” said Edward Dowd, a former BlackRock portfolio manager.
Where comparisons break down
OpenAI generates real revenue. The annual utilization rate of $20 billion by the end of 2025 reflects increased enterprise adoption in various sectors.
“Revenues followed the same curve, growing 3x and 10x year over year from 2023 to 2025, with ARR of $2 billion in 2023, $6 billion in 2024, and more than $20 billion in 2025. This is growth unlike anything we have seen before at this scale,” reads an excerpt from the company’s recent report.
Terra did not have a comparable revenue base. Its yield depended entirely on speculative inflows and algorithmic minting mechanisms.
- OpenAI also works within traditional corporate finance structures.
- PE joint ventures use preferred stock with preferred interest, which is a standard vehicle in the private market.
The 17.5% floor is aggressive and not fraudulent.
However, competitive pressures complicate the situation. Anthropic pursues a PE strategy much like Blackstone, Hellman & Friedman, and Permira, but returns are not guaranteed.
The fact that OpenAI felt forced to add floor space, and that established companies like Thoma Bravo are still holding back, suggests that competition for capital is intensifying faster than profits can keep up.
This signals a broader shift, with AI development entering a stage where financial engineering is as important as model performance.
Will the 17.5% guarantee prove to be a wise distribution strategy, or will it be the first crack in the overheating cycle?
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Everything will depend on how quickly OpenAI can convert access to PE portfolios into paid enterprise contracts before the expected $14 billion in losses in 2026 further undermines investor confidence.
Crypto veterans who watched Terra’s 19% yield attract billions of dollars before it evaporated say the pattern looks familiar.
The scale is different. The question is whether the ending will be the same.
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Why OpenAI’s 17.5% Guaranteed Return Makes a ‘Terra Luna’ Comparison appeared first on BeInCrypto.
