In a clear move that underscores the converging demands of artificial intelligence and cryptocurrency infrastructure, Google has facilitated another substantial deal for a Bitcoin mining company. Cipher Mining announced on Thursday that it has agreed to lease its data center in Colorado City, Texas, to Fluidstack, a U.K.-based AI computing startup.
The financial scale of the agreement is considerable. Cipher Mining projects the initial 10-year lease will generate $3 billion in revenue, with the potential to reach $7 billion if two subsequent five-year extensions are activated. To secure the arrangement, Google has guaranteed $1.4 billion of Fluidstack’s lease obligations. In return for assuming this risk, Google will receive a 5.4% equity stake in Cipher Mining.
This transaction signals a strategic pivot for Cipher Mining. The company will repurpose its Texas facility, originally built for Bitcoin mining, to support high-performance computing (HPC) services for AI. The company’s CEO, Tyler Page, indicated this is likely the first of several ventures into the HPC sector, stating, “We believe this transaction represents the first of several in the HPC space.”
This is not an isolated case. The deal mirrors one announced in August, where miner TeraWulf leased a data center in western New York to the same startup, Fluidstack, in a $3.7 billion agreement. In that instance, Google backstopped $1.8 billion and acquired an 8% equity stake in TeraWulf.
The Industry’s Strategic Pivot
These partnerships reflect a broader industry trend. As AI developers engage in a fierce race for computational power, they are seeking out any available infrastructure. The recent announcement of a plan between OpenAI and Nvidia to construct AI data centers with an energy footprint rivaling major cities highlights the immense scale of this demand.
Bitcoin mining companies, which operate large, power-dense data centers filled with specialized computers, are becoming attractive partners. While the computer servers used for AI are different from those designed for cryptocurrency mining, the underlying infrastructure-access to substantial power and robust cooling systems-is highly transferable. This similarity has not gone unnoticed.
The most prominent example of a successful pivot is CoreWeave, which transitioned from mining Ethereum to building AI cloud infrastructure. Now valued at approximately $65 billion, its client list includes leading tech firms like OpenAI and Google itself. Other miners are attempting to replicate this success. Core Scientific, for instance, agreed to a $9 billion acquisition by CoreWeave in July, though that deal currently faces shareholder resistance over valuation concerns.
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