Wall Street hedges against Big Tech as CDS activity surges to record levels

Wall Street has a new favorite insurance policy, and it’s written against the companies everyone supposedly loves the most.

Credit default swaps tied to major US tech firms have exploded in volume, with exposure growing 90% since September 2025 according to data from the Depository Trust & Clearing Corporation. Weekly CDS trading volumes hit roughly $8 billion in December 2025, the highest level ever recorded.

The AI debt binge that spooked the bond market

The hyperscalers, Alphabet, Amazon, Meta, Microsoft, and Oracle, collectively issued approximately $121 billion in new debt during 2025. That capital went toward AI infrastructure and data centers, the physical backbone required to train and deploy increasingly powerful models.

Oracle emerges as the focal point