Nvidia Acquires $2 Billion Worth of Shares in Bitcoin Miner CoreWeave

AI giant Nvidia invested $2 billion in Bitcoin miner Coreweave, bringing its total investment in the company to $2.4 billion. The company spent $2 billion buying Coreweave shares at $87.20 per share.

This represents a major boost for Coreweave, with its stock rising around 10% following the news and now trading above $100.

CoreWeave to Focus on Expanding Data Center Ambitions

According to the announcement, the investment will be used to boost Coreweave’s data center capabilities. The Bitcoin miner, which has pivoted towards hosting high-performance computing (HPC) infrastructure for AI companies, has big ambitions in the sector.

It plans to add more than 5 gigawatts of AI data center capabilities by 2030.  This is expected to advance AI adoption by integrating Nvidia and CoreWeave infrastructure and software.

As part of the deal, CoreWeave will build and operate AI factories that deploy Nvidia computing architectures. It will leverage Nvidia’s financial muscle and technological strengths in its efforts.

Meanwhile, Nvidia will also test and validate CoreWeave software and technology to make it operable with its own system. The AI giant is also looking to include those tools, including SUNK and Mission Control, in its architecture for cloud partners and enterprise customers.

Speaking on the deal, Nvidia CEO Jensen Huang noted that the company trusts in CoreWeave’s expertise.

He said:

“CoreWeave’s deep AI factory expertise, platform software, and unmatched execution velocity are recognized across the industry. Together, we’re racing to meet extraordinary demand for NVIDIA AI factories the foundation of the AI industrial revolution.”

Nvidia Becomes CoreWeave’s Second Largest Shareholder as Bitcoin Miners Struggle

The new deal adds to Nvidia’s stake in CoreWeave. The AI giant held 24.3 million shares, which is about a 6.3% stake, making it the third-largest shareholder before this new deal.

With the new deal, it is now set to become the second-largest shareholder. The new investments add around 23 million shares to its stake, representing a major premium on the $39 per share it initially paid.

Since its first investment, CoreWeave stock has more than doubled in value. Nvidia reached an agreement to buy $6.3 billion worth of unsold computing capacity through 2032.

For CoreWeave, Nvidia’s additional investment justifies its decision to pivot from Bitcoin mining to AI after the 2022 crypto crash. While the company’s stock has increased in value, most Bitcoin miners have plunged drastically amidst struggles with profitability.

Interestingly, Bitcoin miners are not only dealing with volatile performance but also with harsh weather. The recent arctic blast has forced miners to unplug around 110 EH/s in computing capacity, causing block production to drop to 12 minutes.

Unsurprisingly, all major Bitcoin miners have now added HPC hosting for AI companies to their offerings. This highlights the increasing focus on developing AI infrastructure, especially as Bitcoin mining becomes less profitable.