Microsoft invests 9.7 billion dollars in IREN.

Microsoft Takes Control with IREN

Microsoft is making a significant transformation in the cryptocurrency mining sector with its approximately $9.7 billion deal with IREN. In a statement made on Wednesday, Australia-based IREN became Microsoft's largest customer. Under the five-year agreement, this neo-cloud operator, specializing in data centers for artificial intelligence workloads, will provide Microsoft access to Nvidia chipsets.

IREN's stocks saw a 10% increase on the first day and have recorded an approximately 580% rise since the beginning of the year.

Additionally, IREN formed a partnership with Dell Technologies worth approximately $5.8 billion to purchase processors and related equipment. This agreement reinforces the transformation of cryptocurrency miners into a central player in the artificial intelligence wave and explores the opportunity to utilize land, energy, and data centers for artificial intelligence workloads with long-term contracts.

Many miners, including Riot, TeraWulf, and Cipher Miner, have redirected their resources toward high-performance computing infrastructure and artificial intelligence. This shift has resulted in stock increases of approximately 100%, 160%, and 360% respectively for these companies over the year.

Bernstein analyst Gautam Chhugani and his team stated, "Bitcoin miners are now an integral part of the AI value chain. They are providing heated power shells for AI data centers, which is considered the biggest bottleneck for execution."

Chhugani added, "Every Bitcoin miner listed on the U.S. stock exchange has undergone a transformation toward optimizing the value of energy assets instead of maximizing Bitcoin earnings." Fluctuations in Bitcoin prices and a crowded mining field have compressed profit margins, while Bitcoin's four-year 'halving' event has further eroded revenues over time.

IREN announced earlier this year that it would cease expanding its Bitcoin mining operations and prioritize its artificial intelligence cloud and data center business. Bernstein gives the stocks a 'Buy' rating with a price target of $75, stating, "We believe there is still room for multiple expansions as IREN continues to scale its artificial intelligence business."