Bitcoin Miner Iris Energy Revives High-Performance Computing Strategy Amid Booming Interest in AI

Iris Energy (IREN) said it is reviving its strategy around hosting high-performance computing alongside bitcoin miners in a Tuesday press release, as interest in artificial intelligence (AI) continues to boom.

Several miners, including Applied Digital Corporation (APLD), Crusoe Energy, Hut 8 Mining (HUT) and Hive (HIVE) have recently branched out into other types of compute. Demand for data center space for AI is estimated to grow to $76 billion by 2028, with large language models such as OpenAI's ChatGPT becoming increasingly popular.

Shares of Iris Energy were up 19% on Tuesday early afternoon, and other publicly-traded bitcoin miners such as Hut 8 and Hive that have announced pivots to AI were also up sharply.

Read more: Nvidia's Blockbuster Outlook Reminds Bitcoin Miners to Give AI a Look

Iris Energy plans to increase its data center capacity to 9.1 exahash/second (EH/s) by early 2024, from its current 5.6 EH/s, the miner said.

"Significant time was invested in exploring" a strategy for high performance computing about three to four years ago, "including signing a strategic memorandum of understanding with Dell Technologies in March 2020 to test and develop potential data center solutions for energy intensive compute applications, including leveraging Dell Technologies’ HPC and artificial intelligence expertise," said Iris Energy.

Given recent developments, "the time may be right to expand into this sector," using either Iris Energy's existing sites or the ones under construction, the company said. The miner has procured items with long lead times to expand to build out another 100 megawatt (MW) facility, which would bring its mining hashrate to 13.6 EH/s if filled with mining rigs, said the press release.

Miners' access to cheap energy and data center infrastructure may make it seem like it would be easy for them to pivot to AI and cloud computing. However, the requirements of high-performance computing industries differ significantly from mining in terms of quality of operations, uptime and customer service.

Read more: Crypto and Bitcoin Miners Rebrand and Diversify to Survive: A Look at Their New Strategies

UPDATE (June 20, 17:11 UTC): Added information about Iris's stock performance.