In a noteworthy development within the cryptocurrency sector, Bitcoin miner TeraWulf has announced an expansion of its partnership with Fluidstack, marking a significant stride in its operations amidst a challenging landscape for Bitcoin mining stocks. The announcement sent TeraWulf’s stock soaring by nearly 17% on Tuesday, despite a generally dismal day for the industry.
TeraWulf, which trades on Nasdaq under the ticker WULF, closed at $17 per share following the news of its joint venture with Fluidstack. However, in after-hours trading, shares experienced a slight dip to $16.24. The Easton, Maryland-based company revealed plans to enhance computing capabilities for artificial intelligence through their ongoing collaboration with Fluidstack, an AI cloud solutions provider backed by Google.
The new venture involves the development of 168 megawatts (MW) of critical IT infrastructure at a site in Abernathy, Texas, with a hosting commitment lasting 25 years. TeraWulf is set to maintain a majority stake of 51% in this joint venture, reinforcing its strategic position in the market.
This expansion comes on the heels of an earlier agreement made in August, where TeraWulf and Fluidstack initiated plans to construct a new data center, bolstered by Google’s support. TeraWulf CEO Paul Prager emphasized the evolution of their strategy, stating, “This is exactly the evolution we outlined: converting advantaged infrastructure positions into contracted megawatts with investment-grade counterparties and doing so at strategic scale.”
In stark contrast to TeraWulf’s success, other leading Bitcoin miners faced declines in their stock prices. Riot Platforms dropped 6.2%, while CleanSpark and MARA Holdings fell by approximately 5.2% and 3.5%, respectively. IREN experienced a decline of nearly 4%. The Bitcoin mining landscape has become increasingly competitive, especially after last year’s halving event reduced the rewards for mining from 6.25 to 3.125 coins, making the process more arduous.
Despite a recent uptick in Bitcoin prices, the growth has not matched the pace of previous cycles, leaving miners to seek alternative revenue streams. In line with industry trends, Hut 8, another publicly-traded miner, recently unveiled plans to develop a substantial 1.53 gigawatts of new mining capacity across four locations in the U.S.
In a notable move, Google solidified its position in the sector by facilitating a separate deal between Fluidstack and Bitcoin miner Cipher, which grants Google a 5.4% stake in Cipher. Overall, Bitcoin mining stocks have shown resilience as companies pivot to leverage the burgeoning artificial intelligence sector.
Bitcoin itself was trading below $113,000, marking a 1.6% decline over the previous 24 hours and an approximate 10% drop from its recent all-time high of over $125,000 earlier this month, according to crypto data provider CoinGecko. In a prediction market, sentiment remains optimistic, with about two in three respondents leaning towards a potential rise to $120,000, contrary to entrepreneur KBM’s forecast of a drop to $100,000.
