Core Scientific Signs 12-Year Agreement with AI Company
Core Scientific, the leading provider of Bitcoin mining and hosting services in North America, has recently inked a series of significant 12-year agreements with the AI hyperscaler, CoreWeave. These agreements are projected to yield a total revenue of around $3.5 billion over their duration, with an average annual revenue of approximately $290 million.
The CEO of Core Scientific, Adam Sullivan, highlighted the strategic value of the agreement, emphasizing how it allows the company to diversify its business model by balancing Bitcoin mining with alternative computing hosting. Sullivan emphasized that this expanded partnership with CoreWeave not only provides exposure to the potential growth of Bitcoin but also positions Core Scientific to optimize cash flow and mitigate risks.
In line with the agreement, Core Scientific will allocate 200 megawatts of infrastructure and undertake renovations at its current sites to cater to CoreWeave's needs. The objective is to have these facilities operational by the first half of 2025. CoreWeave will finance all essential capital investments to replace Core Scientific’s current infrastructure. To assist in covering these expenses, CoreWeave plans to offer Core Scientific a loan amounting to an estimated $300 million, which will be gradually recouped through monthly hosting fees.
Following the Bitcoin halving incident in April, which reduced miner rewards by 50%, Bitcoin mining companies like Core Scientific are actively seeking avenues to diversify their revenue streams. Notably, other prominent mining entities such as Bit Digital and Hut 8 are also exploring the integration of artificial intelligence to enhance their income potential.
Disclaimer: This content is solely for informational purposes and does not constitute investment advice.
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