- AiOnX takes 77% stake in US-based cryptocurrency mines
- The deal means it takes control of 15 data centers in the US and Sweden
- The $500 million acquisition secures access to 1.3 Gigawatts of power, an increasingly scarce commodity for AI data centers
AiOnX, a major data center infrastructure developer focused on hyperscalers across Europe, has taken a majority stake in US-based cryptocurrency mining firm Genesis Digital Assets.
The transaction, valued at $500 million, sees its parent company, SWI Group, take a 77% stake in GDA, giving it control of 15 crypto-mining data centers across the US and Sweden – and perhaps more importantly, access to 1.3 Gigawatts of available power.
The agreement includes 15 data centers across North Carolina, South Carolina and Texas, as well as two locations in Sweden.
A faster build with easy access to power
The move by SWI Group was reported by DataCenterDynamicswhich said a deal was in the works between SWI and a then-unnamed US crypto-mining entity.
That appears to have been dictated by GDA’s access to readily available power, though most hyperscaler deployments continue to struggle with their own power constraints, which studies indicate could ultimately halt AI data center growth as early as 2030.
The reason why GDA made a relatively smooth acquisition of SWI, thanks to its power connection.
“Power connectivity is the most valuable commodity in digital infrastructure today, and converting legacy cryptocurrency mining infrastructure to AI and high-performance computing is the best and highest use of these assets,” noted SWI Founder and CEO, Max-Hervé George.
“We have invested in power connection since 2020. This is what that thesis looks like at scale.”
However, this is not an isolated move, with many cryptocurrency miners now pivoting to or being outright acquired by AI hyperscalers as demand for computing continues unabated as models scale over time.
The reason is that not only is cryptomining relatively unprofitable compared to AI workloads that lease GPUs under long-term contracts, but it is also inconsistent as cryptocurrency prices tend to fluctuate, providing an unpredictable payday for cryptominers, many of whom are heavily leveraged to cover their debt needs.
While modern crypto-ASICs cannot be reused for AI needs, the power they consume, much of which is locked up via long-term contracts, is much more valuable to AI data centers since their power needs are already taken care of and available on-site, compared to many otherwise ambitious and time-consuming power generation projects that some hyperscalers have been directly forced to invest in.
For context, according to estimates from Coindesk, AI contracts offer margins of as much as 85% with multi-year revenue visibility in tow, making cryptomining even as hashrates continue to rise while Bitcoin remains below $70,000, reflecting a broader crypto market that some feel has already entered a bear-induced winter.
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