TLDR
- TeraWulf signed $3.7B worth of 10-year AI infrastructure agreements with Fluidstack, potentially expanding to $8.7B with extensions
- Google will support $1.8B of Fluidstack’s lease obligations and receive warrants for 8% equity stake in TeraWulf
- Stock price jumped to $8.71 on August 14, breaking above $6 resistance level held since mid-January
- Bitcoin mining costs doubled from $22,954 to $45,555 per coin in Q2 2025 while production dropped 30%
- Company pivots from crypto mining to capitalize on AI market projected to reach $1.01T by 2030
TeraWulf stock climbed sharply on August 14 after the crypto mining company announced a major shift toward AI infrastructure hosting. The stock closed at $8.71, marking the first time it traded above $6 since mid-January.
The rally came after TeraWulf revealed two 10-year high-performance computing colocation agreements with AI cloud platform Fluidstack. The initial contracts are worth approximately $3.7 billion.
The deal includes two five-year extension options that could bring total contract revenue to $8.7 billion. TeraWulf will provide over 200 MW of critical IT load from its Western New York data center campus.
Google’s involvement adds another layer to the partnership. The tech giant will support $1.8 billion of Fluidstack’s lease obligations to help with project-related debt financing.
In exchange, TeraWulf will issue warrants allowing Google to acquire roughly 41 million shares of common stock. This represents about an 8% equity ownership stake in the company.
The timing of this pivot makes sense given the mounting challenges in Bitcoin mining. TeraWulf’s Q2 2025 mining performance tells the story clearly.
Mining Economics Turn Sour
The company mined just 485 Bitcoin in Q2 2025 compared to 699 Bitcoin during the same quarter in 2024. That’s a 30% drop in production year-over-year.
Meanwhile, power costs per Bitcoin nearly doubled. TeraWulf spent $45,555 in power costs per Bitcoin in Q2 2025 versus $22,954 in Q2 2024.
Bitcoin’s built-in difficulty adjustments and halving events continue to make mining more resource-intensive. Companies need more energy and computing power to mine the same amount of Bitcoin over time.
These economics are pushing miners like TeraWulf to find alternative revenue streams. AI infrastructure hosting offers a compelling alternative use for their existing data center assets.
The AI Opportunity
The AI market presents a much brighter financial picture than crypto mining. Statista projects the AI market will grow from $244.22 billion in 2025 to $1.01 trillion by 2030.
That represents a compound annual growth rate of 26.6%. For a company sitting on substantial data center infrastructure, the choice becomes obvious.
TeraWulf isn’t alone in making this transition. Other crypto companies are also exploring AI opportunities as mining becomes less profitable.
The company’s Western New York facility gives it a strategic advantage. The location provides access to reliable power infrastructure needed for both crypto mining and AI computing.
TeraWulf can leverage its existing investments in power and cooling systems for AI workloads. This allows the company to diversify without starting from scratch.
The Google partnership adds credibility to TeraWulf’s AI ambitions. Having a major tech company willing to provide financial backing and take an equity stake validates the business model.
The warrant structure also aligns Google’s interests with TeraWulf’s success. Google benefits if TeraWulf’s stock price rises above the warrant exercise price.
TeraWulf’s transition reflects broader trends in the crypto mining industry. As Bitcoin mining becomes more challenging and expensive, companies are seeking ways to monetize their infrastructure investments through AI services.
