Google Backs Bitcoin Miner TeraWulf in $3B Data Center Expansion

Bitcoin miner TeraWulf pivots to AI hosting with Google $3.2B support

What happens when a Bitcoin mining company decides to step into the fast-growing world of artificial intelligence? 

That’s the big question facing Bitcoin miner TeraWulf, which is preparing to raise $3 billion with Morgan Stanley’s help. 

Source: X (formerly Twitter) 

The deal, backed by Google, could change how investors think about the future of mining companies.

Google Expands Its Stake in TeraWulf

Google is no longer just a dormant partner. 

According to Bloomberg, the tech giant has agreed to backstop $3.2 billion in TeraWulf’s data center lease obligations. 

• In return, Google will get warrants equal to a 14% equity stake in the bitcoin mining company. 

• This makes Google both a guarantor and a shareholder, giving the organisation a serious boost as it expands into new territory.

• With Google standing behind it, the company is aiming to secure $3 billion through a high-yield bond or leveraged loan. 

• CFO Patrick Fleury noted that the transaction could wrap up as early as October, though the details are still being finalized. 

A High-Risk, High-Reward Strategy

The plan for Bitcoin miner TeraWulf is ambitious: spend big now to build out a dual business model that combines Bitcoin mining with AI infrastructure hosting. The move could give the company exposure to two massive markets: cryptocurrency and artificial intelligence.

But this shift doesn’t come without risks. Credit rating agencies are reportedly weighing a grade between BB and CCC for the new debt offering, which puts it firmly in the “junk bond” category. 

Investors are worried about the company’s growing debt, potential construction delays, and the challenge of managing two very different businesses at once.

AI Meets Crypto Infrastructure

For years, the organisation has been seen as a pure crypto play, tied closely to the ups and downs of BTC’s price. 

Now, with its pivot into AI, the company is reframing itself as a digital infrastructure provider. 

If it succeeds, TeraWulf could land long-term, multi-billion-dollar contracts with big tech companies that need advanced data center space.

Google’s involvement highlights the potential. The partnership signals that minning infrastructure, with its access to cheap energy and powerful hardware, may be uniquely suited to hosting AI workloads. 

This crossover between crypto and artificial intelligence is quickly becoming one of the hottest trends on Wall Street.

Cipher Mining as a Rival

TeraWulf isn’t the only miner drawing attention. Cipher Mining has also teamed up with Google and Fluidstack, landing $1.4 billion in support. While TeraWulf has the larger, riskier deal, Cipher’s arrangement is seen as cleaner and less debt-heavy. Some investors prefer Cipher’s steadier momentum, while others are betting on TeraWulf’s bigger upside. 

What’s Ahead?

The forthcoming months will prove paramount. Bitcoin mining company TeraWulf obtained the capital (around $3 billion) and set forth upon the pivot to AI infrastructure. The market recently has looked on with baited breath, calculating the risk with the potential that might be one of the most daring plays in the industry.