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Bitcoin miners, large and small, are pushing into Artificial Intelligence, a market that will require immense amounts of power to handle the training of large language models.
Demand for AI compute and infrastructure surged after OpenAI unveiled ChatGPT in November 2022. High performance computing solutions are highly sought after.
The 800 pound gorilla in AI compute is cloud provider CoreWeave. The last round of funding valued CoreWeave at $19 billion.
Traditional data center operators are falling short of meeting the surging demand for AI compute capacity.
The market is waking up to the fact that bitcoin miners control high quality power assets.
Earlier this month, Core Scientific announced a new partnership with CoreWeave that centers around 200 megawatts of power infrastructure. Core Scientific has rallied 254% since emerging from bankruptcy in January. The current market capitalization remains well below the $4+ billion the company reached at the height of the last bitcoin bull market in 2021, but the company is on a roll. Core Scientific’s expanded arrangement with CoreWeave is expected to produce annual revenue of $290 million. Core Scientific has also announced that it’s working to convert 500 megawatts of its bitcoin mining infrastructure to AI compute.
More and more miners are working on retrofitting their data centers to meet the demand for AI compute.
Bit Digital already derives over a quarter of its revenue from AI compute.
Tether International Limited invested up to $150 mm in a private placement of stock and warrants issued by Bitdeer Technologies Group boosting their stake in the bitcoin miner to 25%. In March, Bitdeer AI became the first cloud service platform in the Asian region to offer NVIDIA DGX SuperPOD H100 service.
Bitcoin miner Hut 8, redefining itself as a “vertically integrated operator of large-scale energy infrastructure”, today announced that it had secured a $150 mm investment by Coatue Management LLC. The $59 billion technology focused hedge fund is an investor in CoreWeave. Hut 8 purchased its first batch of 1,000 Nvidia GPUs and secured a customer agreement with a venture-backed AI cloud platform as part of its expansion into AI compute.
Will the hype stirred by AI compute revalue the bitcoin mining industry ?
Watch this space.