Bitcoin Miner Core Scientific Pumps 17% After Inking Another Contract With CoreWeave

The contract illustrated that Core Scientific had contracted CoreWeave for 382 megawatts of mining infrastructure.

Bitcoin miner Core Scientific (NASDAQ:CORZ) saw its stock surge by double digits on Tuesday after announcing an additional computing contract.

What Happened: Core Scientific signed a new contract with AI Hyperscale CoreWeave, a subsidiary of CoreWeave, for an aggregate consideration of $2 billion over 12 years.

The terms of the contract will see the miner enhance its mining infrastructure to deliver approximately 112 incremental MW to accommodate GPUs from the AI Hyperscale company. These modifications will begin prior to the end of 2024 to facilitate the commencement of operations in the first half of 2026. The HPC hosting contract will expand the miner’s cumulative revenue to $6.7 billion.

CoreWeave Signs Another Contract With Core Scientific: The contract highlights that Core Scientific has contracted CoreWeave for a total of 382 megawatts of mining infrastructure. CoreWeave will cover all expansion costs to set up the infrastructure for the upcoming high-performance computing (HPC) operations, according to the announcement.

“We have now contracted with CoreWeave for a total of 382 megawatts of HPC infrastructure, reflecting the strong demand for high-power data center infrastructure and the unique ability of our team to deliver it.”

Adam Sullivan, Core Scientific’s CEO

Both entities, Bitcoin miners and AI companies, heavily rely on data centers and vast amounts of energy to operate their respective businesses. Bitcoin miners already have established power infrastructure and supporting contracts, which artificial intelligence companies, like CoreWeave, require. Building infrastructure or utilizing legacy data centers would be an expensive undertaking for the AI companies.

Hence, CoreWeave joins hands with the Bitcoin miner in a symbiotic relationship that will economically benefit the two companies. Core Scientific stated that it may enter into an agreement to host an additional 118 MW of machines for HPC computing to capitalize on the increasing demand.

Core Scientific, CoreWeave Partnered In June: In a separate contract signed by the two parties in June, Core Scientific was to provide 200 megawatts of infrastructure to house CoreWeave’s high-performance computing services. The deal was left open with the potential for further capacity, which saw an additional 70 MW.

The recent contract marks the third expansion to the original deal. The June agreement brought crypto mining back into the spotlight, which has faced headwinds from the crypto downturn and the thin profit margins, exacerbated by the halving event.

The contract noted that the partnership will diversify the miner’s revenue streams to complement Bitcoin mining. The agreement also mandates CoreWeave to cover the expansion costs required to upgrade Core Scientific’s mining infrastructure to house the AI Hyperscale. As per the announcement, CoreWeave is set to invest $300 million to enhance the infrastructure.