Cipher Mining Secures $50 Million Investment from SoftBank’s Stargate AI Initiative
Cipher Mining, a prominent bitcoin mining company, has announced a significant $50 million investment from SoftBank, a Japanese multinational conglomerate with a valuation of $300 billion. This investment involves SoftBank acquiring approximately 10.4 million shares of Cipher Mining’s common stock, marking a strategic move to bolster the company’s high-performance computing (HPC) and artificial intelligence (AI) data center infrastructure.
In a recent press release, Cipher Mining detailed that the funding is structured as a private investment in public equity (PIPE). The capital infusion will support the expansion of Cipher’s HPC and AI data center operations, enhancing its capacity to meet the growing demands of these sectors. Additionally, Cipher has entered into a one-month exclusivity agreement with SoftBank concerning its 300 MW Barber Lake site in Texas, preventing the sale or negotiation of deals with other parties during this period.
“We are thrilled to welcome SoftBank as an important investor in Cipher,” said Tyler Page, CEO of Cipher Mining. “This investment comes at a pivotal moment in Cipher’s growth trajectory, as the company continues to attract attention for its pipeline of sites and innovative solutions in industrial-scale data centers.”
Cipher Mining, currently the tenth-largest public bitcoin miner with a market capitalization of $1.6 billion, is among several mining firms diversifying their operations into AI data center hosting. This strategic shift aims to mitigate the volatility associated with bitcoin’s market cycles while capitalizing on the increasing demand for AI solutions. Last year, companies diversifying into AI outperformed their pure-play bitcoin mining counterparts, although Cipher experienced a downturn following the DeepSeek-fueled market dislocation.
A Strategic Investment Amid Market Fluctuations
Analysts at JPMorgan view SoftBank’s $50 million investment as a potential indicator of future trends within the bitcoin mining sector’s diversification into AI. “This deal was in the works well ahead of the DeepSeek news this week; nonetheless, we think it validates continued demand and interest in large sites with power agreements in place,” the analysts noted in a client-facing report.
Cipher’s acquisition of the Barber Lake 300 MW site in September 2024, complete with a power agreement and sub-station, positions it as an attractive asset for hyperscalers—large-scale cloud service providers. The company is also advancing other sites in various stages of construction, totaling up to 2.6 gigawatts (GW), further expanding its infrastructure footprint.
SoftBank’s Commitment to AI and Cloud Computing
SoftBank has been actively expanding its investments in AI and cloud computing, most notably through the Stargate Project. Announced shortly after President Trump’s inauguration, the four-year, $500 billion initiative collaborates with OpenAI, Oracle, and Emirati investment firm MGX, with support from the U.S. government. The project includes a $100 billion rollout of AI data centers in the United States and potential direct investments of $15 billion to $25 billion into OpenAI.
“SoftBank’s focus on innovation in technology and AI development aligns with our vision to establish ourselves as a leader in HPC data center development,” added Tyler Page.
Looking Ahead
While the $50 million investment is a substantial boost for Cipher Mining, it represents a fraction of the overall development costs for HPC data center infrastructure. Nonetheless, SoftBank’s involvement signals strong confidence in Cipher’s strategic direction and the broader trend of integrating AI capabilities within the cryptocurrency mining industry. As the demand for AI solutions continues to rise, Cipher Mining is well-positioned to leverage this investment to drive growth and innovation in both the mining and AI sectors.