IREN Secures $3 Billion for AI Infrastructure Expansion

IREN secures $3 billion for AI infrastructure expansion.

Bitcoin miner and data centre operator IREN has completed the issuance of convertible senior notes amounting to $3 billion.

The initial offering was set at $2.6 billion, but buyers fully exercised the option for additional notes worth $400 million.

The company’s net proceeds after deducting fees amount to $2.96 billion.

The bonds carry a coupon rate of 1% per annum and mature in 2033. The conversion premium is set at 32.5%. The instrument was privately sold to institutional investors.

Approximately $201 million of the proceeds were allocated to “capped call” transactions, a hedging mechanism designed to protect shareholders from dilution when the bonds are converted into shares.

The remaining funds will be used for working capital and general corporate purposes.

IREN is developing infrastructure for cloud computing and artificial intelligence. The company owns data centres and a fleet of GPUs in North America, Europe, and the Asia-Pacific region.

Miners Shift to AI

According to TheEnergyMag, the total hashrate of the Bitcoin network in the first quarter declined from 985 EH/s to 873 EH/s. The drop in activity is linked to major mining companies shifting focus to infrastructure for artificial intelligence and high-performance computing (HPC).

The most significant declines were recorded by IREN (from 42.96 EH/s to 35.83 EH/s) and Keel Infrastructure (from 16.52 EH/s to 11.51 EH/s). The company Cipher Digital completely halted operations at the Black Pearl site to repurpose it for AI needs.

Core Scientific also confirmed plans to scale back mining. By the end of the year, the company will have no more than two cryptocurrency mining sites. In the first quarter, Core Scientific wrote off assets worth $266.5 million, with more than half attributed to mining equipment.

Some players have seized the opportunity to expand their market share. Riot Platforms increased its hashrate to 42.29 EH/s, while Bitdeer reached 50.26 EH/s. American Bitcoin boosted its capacity to 28.1 EH/s, using Bitcoin collateral instead of cash to purchase new devices.

Previously, miners would shut down devices due to falling prices or high electricity costs, but now they are abandoning Bitcoin mining in favour of AI due to more stable profitability and financing conditions. Data centres repurposed for GPUs are unlikely to return to mining in the near future, concluded TheEnergyMag.

Earlier, TeraWulf reported first-quarter revenue of $34 million, with approximately $21 million generated from HPC services.