Cipher Mining, long known for its blockchain operations, stunned markets this week by unveiling a $5.5 billion, 15-year agreement with Amazon Web Services (AWS) – signaling a dramatic shift from crypto mining to large-scale AI hosting.
The partnership grants AWS access to Cipher’s upcoming data center capacity for high-performance computing, marking the company’s most significant contract to date. The deal, which begins in 2026, will initially deploy 300 megawatts of power through both liquid- and air-cooled systems designed to handle AI workloads. Construction and delivery will unfold in two stages, with rent payments starting in August 2026.
Texas Becomes the Next AI Battleground
Cipher isn’t stopping there. Alongside the Amazon agreement, the company announced plans to develop an enormous data center complex in West Texas called Colchis. The 620-acre site will connect directly to the American Electric Power grid through dual interconnections, with full activation scheduled for 2028 pending approval from ERCOT, the Texas grid operator.
Cipher will control roughly 95% of the new joint venture, providing most of the financing. The facility is being designed from the ground up to accommodate AI training clusters, GPU farms, and other high-performance computing demands that traditional cloud operators are struggling to meet.
From Crypto Powerhouses to AI Providers
The deal caps off a transformative year for Cipher and a growing list of miners pivoting toward artificial intelligence. What began as an energy-intensive race to mine Bitcoin has become an arms race for data infrastructure. These firms, sitting on large power contracts and vast real estate footprints, have found themselves ideally positioned to supply the computing backbone that AI giants like Amazon, Microsoft, and Google now require.
Cipher was among the first to make that leap. In September, it struck a 10-year, 168-megawatt hosting deal with Fluidstack — a contract backed by Google’s $1.4 billion guarantee and rewarded with a 5.4% equity stake. CEO Tyler Page called that transaction “the turning point,” and this new AWS lease, he said, “cements Cipher’s place among the next generation of AI infrastructure leaders.”
Financial Picture Strengthens as Market Takes Notice
Cipher’s earnings report showed a third-quarter net loss of $3 million, equivalent to one cent per share, but adjusted income reached $41 million. The firm also completed a $1.3 billion convertible note raise, expanding liquidity for future projects. More notably, its AI-related hosting contracts have now grown to represent a staggering $8.5 billion in lease commitments — a figure that rivals the total market cap of many mid-tier data center operators.
Investors reacted immediately. Cipher’s stock skyrocketed over 33% on Monday to $24.81, extending a run that has already seen shares climb more than 400% this year. The company’s rapid rise mirrors the broader revaluation of miners diversifying into the AI supply chain.
The AI Race Redefines Energy and Infrastructure
Cipher’s expansion arrives as tech giants rush to secure computing power for large language models and generative AI systems. Earlier the same day, Australia’s IREN announced a separate $9.7 billion deal with Microsoft to provide access to Nvidia GB300 GPUs — news that sent its own shares up nearly 30% in pre-market trading.
The convergence of crypto and AI infrastructure is becoming one of 2025’s most defining trends. For Cipher, which only a year ago was known as a mid-tier Bitcoin miner, the new partnerships have turned it into a major player in the global AI ecosystem — and possibly a model for how the mining sector can reinvent itself for the data-driven era ahead.