Cipher Mining Announces Landmark Deal With Amazon
Cipher Mining saw its shares surge by over 34% after the company revealed a new 15-year agreement with Amazon Web Services (AWS) valued at $5.5 billion. The deal will see Cipher provide turnkey space and power for artificial intelligence (AI) workloads across two deployment phases, beginning in July and August of next year.
Quarterly Results and Market Impact
Alongside the AWS announcement, Cipher reported third-quarter financial results that showed significant improvement. The company posted a net loss of $3 million, a notable reduction from the $46 million loss in the previous quarter. Adjusted earnings rose to $41 million, up from $30 million. Ciphers stock climbed from $18.65 to a session peak of $25.02 before closing at $22.76 on the day of the announcement.
Shift Toward High-Performance Computing
Bitcoin miners like Cipher have increasingly shifted to hosting high-performance computing (HPC) and AI data workloads. This trend intensified after the latest Bitcoin halving reduced mining rewards to 3.125 BTC per block, negatively affecting profit margins.
- HPC service diversification reflects miners adaptation to market pressures.
- The trend has attracted technology companies looking to secure data center capacity for AI operations.
Industry-Wide Partnerships
The Cipher-AWS partnership follows similar collaborations between crypto miners and major tech firms:
- In September, Google joined a $3 billion data center partnership with Fluidstack, an AI-focused datacenter company.
- On the same day as the Cipher and AWS deal, miner IREN signed a $9.7 billion hosting agreement with Microsoft.
- Cipher previously executed a transaction with Fluidstack and Google, which CEO Tyler Page described as pivotal for the companys presence in HPC services.
Expansion Initiatives
Cipher also announced a majority stake in a joint venture to develop a one-gigawatt AI hosting facility in West Texas, known as Colchis. Cipher will provide most of the financing and receive 95% equity in the venture.
These moves illustrate the growing intersection between crypto mining firms and leading tech companies as both sides look to capitalize on the expanding demand for AI and HPC infrastructure.
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