Shares of Riot Platforms experienced a significant increase, jumping more than 11%, following the company's announcement that it had sold Bitcoin to finance the acquisition of land in Texas.
In a notice released on Friday, Riot disclosed that the $96 million transaction for 200 acres of land located in Rockdale, Texas, was entirely funded through the sale of approximately 1,080 Bitcoin (BTC). The crypto miner also entered into a data center lease and services agreement with Advanced Micro Devices (AMD), a semiconductor company. This agreement involves an initial deployment of 25 megawatts (MW) of "critical IT load capacity."
Riot CEO Jason Les commented on the development, stating, "These results mark a pivotal moment that cements Riot’s position as a leading data center developer, less than twelve months since the launch of our formal process to evaluate our assets for AI/HPC use."
The agreement, which has an initial term of 10 years, is projected to generate about $311 million in revenue for Riot. This figure could potentially rise to $1 billion if three five-year extensions are exercised. Amidst this announcement, Riot's shares, trading on the Nasdaq under the ticker symbol RIOT, surged to $18.80, representing an 11% increase over the preceding 24 hours.
This Texas deal follows a recent announcement from Riot last week, detailing the sale of 1,818 BTC in December. This strategic move is part of a broader shift from solely mining the cryptocurrency to leveraging its data center infrastructure for other applications, including artificial intelligence. As of December 31, the company reported holding 18,005 BTC, a holding valued at over $17 billion at the time of publication.
CleanSpark Also Expanding Texas Operations with AI and High-Performance Computing Focus
CleanSpark, another Bitcoin mining company, announced a similar strategic move on Wednesday. The company reached an agreement to acquire 447 acres of land in Brazoria County, Texas. CleanSpark intends to develop a 300 MW data center on this site, which it stated could be "designed for artificial intelligence and high-performance computing workloads."
Both Riot and CleanSpark are among numerous companies in the mining and crypto mining infrastructure sector that are diversifying their services. This expansion is occurring amidst increasing Bitcoin difficulty. Other companies, including MARA Holdings, Core Scientific, Hut 8, and TeraWulf, have also revealed plans that align with the growing demand for AI and high-performance computing capabilities.