Miners transition into AI giants: Hut 8 signs a $9.8 billion contract, IREN expands cloud capacity
The digital asset market continues to undergo a remarkable transformation: mining companies are increasingly pivoting toward infrastructure for artificial intelligence. On July 20, Hut 8 officially signed a 15-year lease agreement for the second phase of its Beacon Point AI campus in Texas, locking in a total of $9.8 billion. This is not just a deal — it is a strategic move that redefines the business model of the entire industry.
The Scale of the Deal and Its Significance for Hut 8
The agreement was signed with the same high-investment tenant as the first phase, though its name remains confidential. Hut 8 will build an additional 352 MW of computing capacity on Nvidia architecture, bringing the tenant's total contracted capacity to 704 MW. Full commercialization of the 1 GW campus has resulted in a base contract value for Beacon Point reaching $19.6 billion, and with extension options, it could soar to $50.2 billion.
Across Hut 8's entire AI data center portfolio, 949 MW are now under contract, with a total base agreement value of $26.6 billion. The average annual net operating income exceeds $1.75 billion. This is an impressive figure for a company that, until recently, was associated exclusively with Bitcoin mining.
The Market Reacts Instantly
The news immediately impacted stock prices: Hut 8 shares surged 10% to $104.51. A wave of positivity also swept over other miners actively developing AI capabilities. Cipher Mining shares rose 15.4%, TeraWulf gained 5.4%. The CoinShares Bitcoin Miners ETF added 10.6%. Clearly, investors see these companies not just as hash rate providers, but as key players in the high-performance computing market.
IREN: New Contracts and Ambitious Goals
Meanwhile, another Bitcoin miner — IREN — announced the signing of cloud AI service contracts worth $2.8 billion. The company raised its annual revenue forecast for the AI Cloud segment to over $4 billion, with 85% of that amount already secured by signed agreements. Clients include Microsoft, Nvidia, Perplexity, Figure AI, Together AI, and other leading developers. One new client is described as a "leading AI developer," but its name has not yet been disclosed.
Importantly, the contracts include prepayments covering approximately 45% of GPU capital expenditures, significantly reducing the company's need for financing. The weighted average term of the agreements is about four years, and as of June 30, IREN held approximately $7.6 billion in cash and cash equivalents. According to IREN co-founder and co-CEO Daniel Roberts, over the past 12 months, the company has grown from 3 MW of proprietary AI Cloud capacity to 480 MW, with a target of 1.2 GW by 2027.
Following the announcement, IREN shares surged 18.7%.
Expert Opinion
This wave of contracts confirms my long-standing hypothesis: Bitcoin miners are ideal candidates for building AI infrastructure. Their expertise in energy management, access to cheap electricity, and scalable sites make them indispensable partners for hyperscalers. We are witnessing not just diversification, but a fundamental paradigm shift — from cryptocurrency mining to building the "compute factories" of the future. Investors should closely watch this trend, as it could yield returns incomparable to traditional mining.