Bitcoin Miner MARA jumps 17% after striking a deal with Starwood to build AI data centers

• Bitcoin miner MARA Holdings signed a deal with Starwood Digital Ventures to develop AI data centers.
• The pivot follows a roster of bitcoin miners pivoting to serve as infrastructure for AI compute demand.
• MARA shares rose 17% on the announcement in post-market trading.

MARA Holdings shares jumped 17% after the bitcoin mining firm announced Thursday a partnership with Starwood Capital Group to build large data centers across its existing U.S. sites.

The agreement will convert select MARA locations, many of which were originally developed for Bitcoin mining, into facilities serving enterprise cloud and artificial intelligence customers.

Starwood, which manages more than $125 billion of assets, will lead design, construction and tenant sourcing through its data center arm, Starwood Digital Ventures. The partners expect to deliver about 1 gigawatt of computing capacity in the near term, with plans to scale beyond 2.5 gigawatts over time. The two firms will jointly finance and operate the projects.

The deal marks a major pivot for MARA.

The company built its reputation as a bitcoin miner, but it controls sites with direct access to large power supplies. That access has become valuable as tech firms struggle to secure power for new AI data centers.

MARA's move fits into the trend of a slew of bitcoin miners repurposing their infrastructure to meet increasing demand for artificial intelligence compute. The pivot began after Bitcoin's recent halving cut miners' rewards in half. With rising power costs, shrinking bitcoin price and intensifying competition for mining, miners' profit margins have been squeezed, forcing most firms to diversify or completely pivot into hosting machines for AI firms.

Most recently, another bitcoin miner, Bitfarms (BITF), said that it is rebranding as Keel Infrastructure as part of its pivot from bitcoin mining to data center development for high-performance computing (HPC) and AI workloads.

However, for MARA, it's not ditching its identity as a bitcoin mining company. In fact, its CEO, Fred Thiel, said in a shareholder letter that "Bitcoin remains a core pillar of MARA’s strategy."

"While the timing of a recovery in bitcoin prices is difficult to predict, our long-term conviction in the asset class remains unchanged," Thiel added.

MARA has also reported fourth-quarter earnings, with revenues falling 6% to $202.3 million from $214.4 million in Q4 2024, citing a 14% decline in the average price of bitcoin mined over the quarter.

• Shares of Circle (CRCL), issuer of the USDC stablecoin, are now higher by 45% in the less than two sessions since its fourth quarter earnings report.
• Analysts pointed to a positioning-driven short squeeze rather than fundamentals as fueling the big move.
• Hedge funds have built up significant bearish bets against the stock and have lost roughly $500 million in this rally, according to 10x Research's Markus Thielen.

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