Shares in chipmaker AMD soared after it announced a new partnership with OpenAI on Monday. The maker of ChatGPT has pledged a major investment in AMD graphics processing units to power AI data center infrastructure in coming years, with OpenAI potentially taking a 10% stake in the chip company.

It’s just the latest in a spree of massive interlocking investment deals between major players in the AI industry that has some investors excited, and others worried about the risk of a bubble.

OpenAI is investing in chips from AMD. Meanwhile chipmaker NVIDIA said it’s investing $100 billion in OpenAI, which has reportedly made a deal with Oracle for $300 billion worth of cloud services, which Oracle will build with chips from NVIDIA.

“So, it's just a few players who are really making these circular transactions with each other,” said Doug O’Laughlin at Semianalysis.

He said these companies are making a big bet together: that collaborating on a massive AI buildout will bring massive returns for all.

“Let's just say, when you're spending this much, odds are you have to pull in a lot of partners. And I think they're really connected, and, you know, interlinked with their closest partners, so that their partners have a vested interest in them succeeding,” O’Laughlin said.

This kind of spending concentration is somewhat inevitable said Daniel Newman at the Futurum Group. Only a small number of companies have the capacity to build out AI, so it makes sense for them to leverage each other to grow.

“The dollars come all the way back around – the investments come in, and then the compute is consumed, and then it's distributed, and then the chips are built. Basically, it's very efficient,” Newman said.

But that virtuous cycle could easily turn vicious if the demand for AI isn’t as strong as the industry hopes said tech critic Ed Zitron of the Better Offline podcast.

“You're effectively saying, ‘Hey, mate I will sell this to you, but I will also be the creditor that provides you with the money to buy this from me.’ It's handing money to yourself,” Zitron said.

He said the interlinked financing arrangements are starting to resemble the wireless infrastructure bubble of 2001.

“What happens if that stuff isn't real? There's not enough money to pay for any of this. It’s funny money,” Zitron said.

Investors, though, seem to be taking these AI investments seriously — at least for now. Stock goes up every time a new one gets announced.