Quick Takeaways
- Cipher signs a massive $3 billion, 10-year AI hosting deal
- Google backs $1.4 billion of lease obligations and gets 5.4% equity
- Cipher to raise $800 million to expand crypto mining infrastructure
Crypto Mining Just Got Smarter, and Bigger
Cipher Mining just made one of the biggest moves in crypto infrastructure this year. The company, already a top player in crypto mining, announced a 10-year partnership with AI cloud firm Fluidstack, a deal worth around $3 billion.
But here’s where it gets really interesting: Google is backing $1.4 billion of the contract’s lease obligations. In turn, the tech giants will receive warrants to buy about 5.4% shares of cipher.
It is a serious vote of faith from one of the most powerful companies in the world. What’s the deal about? Cipher is offering 168 megawatts (MW) of high-performance computing (HPC) capacity from its Barber Lake site in Texas, a facility that boasts 244 MW in total.
This capacity will power Fluidstack’s AI infrastructure, all while Cipher keeps full ownership of the facility. And if things go well, the deal could grow even bigger.
There are two optional 5-year renewals, which could bring the total value up to a jaw-dropping $7 billion.
Fueling Crypto Mining Growth with Smart Financing
To help fund this expansion and keep building out its vision, Cipher isn’t just relying on the deal alone. It also announced plans to raise $800 million through convertible senior notes (basically, bonds that can convert into shares later).
These notes won’t pay interest, which makes them an affordable way to raise capital right now. Cipher also included an option for investors to buy up to $120 million more, just in case demand is high.
The money will go toward:
- Building the Barber Lake data center
- Expanding Cipher’s 2.4 gigawatt (GW) HPC infrastructure pipeline
- Scaling out new crypto mining and hosting sites across the U.S.
In short, Cipher is doubling down on growth both in crypto and AI.
A New Chapter for Crypto Mining Companies
This isn’t just another crypto story. It’s part of a much bigger trend: crypto mining companies are evolving.
For years, miners focused mostly on Bitcoin. But now, they’re realizing their facilities can be used for more, especially for AI workloads, which need the same kind of power, cooling, and energy that mining rigs use.
Cipher’s CEO Tyler Page put it clearly:
“This is a transformative transaction that shows how much momentum we have in high-performance computing. It’s just the beginning.”
And he might be right. This could be a model for other crypto mining companies looking to diversify and stay profitable as market conditions change.
Why This Matters for the Future of Crypto Mining
So, why should you care? Because this deal could reshape the crypto mining industry as we know it.
Here’s why:
- Crypto miners are becoming full-blown infrastructure providers, not just Bitcoin factories
- Google’s involvement brings legitimacy and financial strength to the space
- The financing model is smart, with no interest, flexible conversion, and room to grow
Investors seem to agree. After the announcement, Cipher’s stock surged more than 22% in pre-market trading.
It’s now sitting at $14.95 per share, giving the company a market cap of around $5.6 billion, up 192% this year.
