TeraWulf Aims to Secure $500 Million in Bet on AI as the New Bitcoin
TeraWulf seeks to raise $500 million to finance a new AI-focused data center in Texas, following significant backing from major finance players.
Crypto mining firm TeraWulf is in the process of raising $500 million through a convertible note offering aimed at financing a new data center campus located in Abernathy, Texas.
The company announced that this private offering is targeted at qualified institutional buyers and has given underwriters the opportunity to purchase an additional $75 million in notes within 13 days of issuance, subject to market fluctuations.
The convertible senior notes are set to mature on May 1, 2032, and will not accrue regular interest. The conversion can only occur under specific conditions before February 2032. Investors may choose to convert their notes into cash, shares of TeraWulf, or a combination of both, based on terms to be finalized during negotiations.
TeraWulf indicates that the funds raised will support the Texas data center initiative as well as general corporate needs.
TeraWulf performance
Image showing TeraWulf’s performance. Source: Google Finance
Related: Bitcoin miner TeraWulf to raise $3B for Google-backed data center: Report
TeraWulf Shift Towards AI
This recent funding attempt follows reports of TeraWulf collaborating with Morgan Stanley to raise up to $3 billion in debt financing, with Google backing $1.4 billion to enhance the firm’s AI-focused facilities. This expansion aims to solidify TeraWulf’s position in the next-generation computing landscape.
In addition, the company signed a $3.7 billion hosting agreement with Fluidstack, an AI infrastructure provider backed by Google, which now holds a 14% stake in TeraWulf.
The move comes amidst increasing AI demands that have resulted in significant scarcity of data center resources, GPU chips, and dependable energy. Large-scale crypto mining operations are well-equipped to seize these opportunities due to their pre-existing infrastructure and secured energy capacities.
Related: Google takes 14% stake in Bitcoin miner TeraWulf, becoming top shareholder
Galaxy Digital Pulls In $460 Million for AI Data Center
In another development, Mike Novogratz’s Galaxy Digital recently secured $460 million from a major asset manager to expand its Helios AI data center project in Texas. This agreement involves purchasing 12.77 million Class A shares at $36 each, intending to provide 133 megawatts of IT capacity by early 2026.
This financing builds on a previous $1.4 billion loan obtained in August aimed at covering 80% of Helios construction costs. Via a 15-year agreement with CoreWeave, Galaxy will deliver computational power for AI and high-performance computing tasks, predicting around $1 billion in annual revenue.
