Tether-Owned AI Firm Contemplates Sale of Bitcoin Mining Division
AI
Bitcoin Mining
Tether
Northern Data is evaluating the possibility of selling its Peak Mining unit as it looks to concentrate on AI solutions. The proceeds from the sale will be reinvested into expanding the company’s AI capabilities and developing Europe’s largest Generative AI cloud platform.
Last updated:
October 21, 2024 17:52 EDT
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Hassan Shittu
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Hassan Shittu
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Last updated:
October 21, 2024 17:52 EDT
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German infrastructure company Northern Data AG, which specializes in cryptocurrency and artificial intelligence, revealed on Monday that it is considering selling its Peak Mining unit in order to redirect funds towards expanding its artificial intelligence operations.
In response to this announcement
, Northern Data’s shares surged by as much as 12% before stabilizing with a 9.8% increase by 12:06 p.m. in Frankfurt.
Northern Data’s Bold Move: Selling Peak Mining to Fuel AI Ambitions?
The company stated that the feasibility of the sale is closely tied to the “current dynamic market environment” for cryptocurrencies.
Bitcoin prices have increased by over 60% this year, approaching the all-time high of $73,798 in March.
This rise in value comes at a critical time as Bitcoin miners have faced challenges since the Bitcoin halving in April, which cut their main source of revenue in half.
In response to these challenges, some mining companies, including Northern Data, have redirected their high-performance computing resources towards artificial intelligence.
The sale of Peak Mining would provide crucial funds to strengthen Northern Data’s AI solutions division. This division features a generative AI cloud platform that helps businesses launch their AI-powered applications.
The company plans to enhance its Dynamic Enablement Services by introducing new software capabilities and managed services to meet the changing demands of the AI market.
Additionally, Northern Data will focus on investing in data center acquisitions and acquiring advanced AI GPUs to enhance its infrastructure.
Northern Data Shares Surge 10.69% After Strong Q2 Performance
Following recent announcements, Northern Data shares experienced a 10.69% surge on the Frankfurt Stock Exchange, reaching €35.20.
This increase follows
a strong Q2 performance
, with the company reporting a 22% revenue growth and generating €26 million.
The growth is attributed to high activity on its cloud platform and investments in data centers and mining operations, despite the challenges posed by the recent Bitcoin halving.
In September 2023,
Tether
announced a collaboration with Northern Data, focusing on artificial intelligence (AI), peer-to-peer communication, and data storage solutions.
While Tether denied claims of a $420 million investment in 10,000 H100 GPUs from Northern Data, it has been accumulating shares in the company for over a year. Reports from the Financial Times suggest that
Tether is the majority owner of Northern Data
, holding 51% of the stock.
Northern Data has projected a threefold increase in its full-year revenue in 2024, driven by growing demand for AI computing services. The company is also considering a U.S. listing for its AI cloud computing and data center businesses, with a potential valuation of up to $16 billion.
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