Billionaire quant trader Alex Gerko's XTX Markets unveiled plans today (Wednesday) for a €1 billion investment in Finland, marking one of the largest data center developments in the Nordic region. The ambitious project, centered in the northern city of Kajaani, kicks off with the construction of the first facility scheduled for completion in 2026.

XTX Markets Breaks Ground on Nordic Computing Hub in €1 Billion Deal

The development, situated on a 478-acre site, represents a shift for the algorithmic trading firm as it moves to house its extensive computing operations. The initial facility will span 15,000 square meters and feature three data halls with 22.5MW of IT power capacity, alongside office space for 50 personnel, according to the official press release.

“We're building ahead of our needs to establish a backbone for future growth,” said Joshua Leahy, Chief Technology Officer at XTX Markets. “Our need for compute has outgrown available leasing options.”

The facility's design incorporates environmental considerations, using the region's natural climate for cooling systems rather than water-intensive methods. The company states it will offer excess heat from the facility to the local community without charge.

XTX Markets currently handles $250 billion in daily trading volume across 35 countries. The company intends to construct four additional data centers at the same location in subsequent phases. The selection of Kajaani reflects Finland's position as a data center location, with its infrastructure and climate conditions.

“We do not believe data centers need to be constructed in cities or in built-up areas with warmer climates,” explained Michael Irwin, Chief Operating Officer at XTX Markets. “In Kajaani, we can bring real benefits in terms of energy and local employment throughout the duration of the project and beyond.”

The construction phase is expected to generate hundreds of local employment opportunities. The company has engaged Finnish firms Granlund Oy for design services and A-Insinöörit Rakennuttaminen OY for construction management.

Gerko and UK’s Court

According to a Bloomberg report, Gerko lost a legal dispute with British tax authorities in July 2024 concerning the tax treatment of a deferred payment plan. The ruling results in Gerko facing a £22.5 million ($29.1 million) tax liability, which he argues constitutes double taxation.

Appeal judges determined that Gerko, along with other traders at GSA Capital Partners, where he was employed between 2010 and 2015, is required to pay income tax on their share of trading profits. The core of the dispute revolves around whether the profits from the deferred payment plan, allocated to an internal investment unit prior to distribution, should be subject to both corporation tax and the higher-rate income tax.

In a separate development in May, the UK subsidiaries of XTX Markets disclosed their 2023 financial results, revealing a significant decline in profitability. Despite the drop, the company’s management expressed satisfaction with the outcomes, emphasizing that 2022 was an exceptionally strong financial year.

According to the report, XTX Holdings (UK) Limited, which includes XTX Markets Limited and XTX Markets Trading Limited, posted net revenue of £654.4 million, a 33% decrease from £972.7 million in 2022. The decline in net profit was even steeper, falling 56% from £19.2 million to £8.4 million. Nonetheless, the company’s leadership described the results as acceptable.

XTX Markets Technologies Limited, another UK subsidiary responsible for a significant portion of the firm's revenue and profits, also reported declines. Its net revenue fell by over 13%, from £1.51 billion to £1.35 billion, while net profit dropped 23%, from £1.08 billion to £826.9 million. Despite these declines, the company remains a key contributor to XTX's overall operations in the UK.