The tech-focused investment manager Coatue Management will make a $150-million investment into the Bitcoin (BTC) miner Hut 8 Corp as investors continue to capitalize on the artificial intelligence (AI) boom.
On June 24, Hut 8 Corp revealed the multimillion-dollar investment from Coatue Management, owned by billionaire Philippe Laffont, which will take place through a convertible note.
Investing in power
According to the Bitcoin (BTC) miner, the note will pay out 8% each year with a starting term of five years. Hut 8 has the option to extend the note for up to three one-year extension periods. The investment will be a senior unsecured obligation of Coatue Management.
Laffont said they see the Bitcoin miner as “well-positioned” to accelerate new compute capacity and “capitalize” on any opportunities that come from it.
“We are committed to supporting innovators advancing AI and believe that compute capacity is crucial to unlocking significant growth across the ecosystem.”
The completed transaction is anticipated on or before July 11 of this year. On June 21, Hut 8 filed the investment agreement with Coatue with the United States Securities and Exchange Commission.
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Hut 8 stands as one of the largest public miners on the basis of computing power available. It has a current market capitalization value of $1.1 billion.
AI x crypto mining
In the crypto industry, Hut 8 was one of the earliest to get involved in the high-performance computing business, which is now being sought after to power generative AI models and applications.
Other cryptocurrency miners, including Core Scientific and TeraWulf, have also become involved with hosting data centers or striking deals with AI companies. Both of the aforementioned companies saw upticks in their stock prices after making AI-focused deals.
Robert Yin, a partner at Coatue, said the broader market is beginning to appreciate the “scarcity of high-quality power assets,” with Hut 8 having built a “deep pipeline” of assets that are both highly attractive and expandable.
Cointelegraph reached out to Hut 8 for additional information on the investment.
After the Bitcoin halving in April, many mining firms have been looking for ways to make themselves more competitive amid profitability challenges.
Around this time, Hut 8 said it was looking to expand its self-mining operations and its scope of diversified revenue streams.
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