CoreWeave Inc (NASDAQ: CRWV) is pulling out all the stops in the race to secure the energy and data centre capacity required to take a dominant roles in both cryptomining and the emerging artificial intelligence industry.
The company announced on Monday that it intends to buy fellow cryptominer Core Scientific Inc (NASDAQ: CORZ) in an all-stock deal worth USD$9 billion.
AI companies are targeting Bitcoin miners’ energy-heavy sites and power contracts to expand computing infrastructure. Miners built these assets during the crypto boom. CoreWeave said the deal will immediately eliminate over $10 billion in future lease obligations across existing sites over the next 12 years.
Furthermore, the offer values Core Scientific at USD$20.40 per share. This represents a roughly 66 per cent premium to the stock’s closing price before deal talks surfaced in late June.
Core Scientific shareholders will receive 0.1235 CoreWeave stock for each share they hold in the deal.
“This acquisition accelerates our strategy to deploy AI and HPC (high-performance computing) workloads at scale,” said Michael Intrator, CoreWeave’s CEO.
Bitcoin miners have tapped into the AI boom to diversify beyond cryptocurrency. They now lease power and data center space to meet rising demand from AI workloads.
Additionally, Bernstein analyst Gautam Chhugani told Reuters the acquisition is expected to set the bar for other miners pivoting to AI. He added that power remains the biggest constraint for AI data center expansion.
The deal is expected to close in the fourth quarter, and the final price will be determined at that time.
Read more: Bit Digital escapes Bitcoin and doubles down on Ethereum mining
Read more: Israel based hacker group steals millions from Iran’s largest cryptocurrency exchange
CoreWeave’s revenue grew eight-fold last year
CoreWeave began as an Ethereum-focused crypto miner in 2017 but pivoted to AI a few years later. It shut down its mining operations after Ethereum’s 2022 upgrade, “The Merge,” slashed miner rewards.
According to its IPO prospectus, CoreWeave’s revenue grew more than eight-fold last year. In addition, the deal marks a major turnaround for Core Scientific.
The company filed for bankruptcy in late 2022 after bitcoin prices plunged and energy costs soared. It emerged from bankruptcy in early 2024. Further, like several other bitcoin miners, Core Scientific now leans on the AI boom to drive growth.
“CoreWeave gets full control of Core Scientific’s entire 1.3 GW power contracted and future pipeline,” Chhugani said.
CoreWeave first made an unsolicited, non-binding takeover offer to Core Scientific in June 2024. Core Scientific rejected the proposal at the time, calling it significantly undervalued.
Later, the two companies signed a series of 12-year contracts. One agreement had Core Scientific provide CoreWeave with roughly 200 MW of infrastructure to power high-performance computing services.
CoreWeave, which offers access to data centers and Nvidia-powered AI chips, holds a market value of about USD$79 billion, according to LSEG data.
Bitcoin miners are diversifying—if not outright exiting mining entirely—due to shrinking profit margins, rising energy costs, and increased competition. The AI boom has created demand for high-performance computing infrastructure, making miners’ energy intensive sites and contracts attractive to AI firms. Additionally, regulatory pressures and unpredictable crypto prices have added risk to traditional mining operations. By pivoting to AI or leasing out infrastructure, miners can secure more stable revenue streams while capitalizing on existing assets built during the crypto boom.
.
joseph@mugglehead.com
