Hook
Core Scientific just signed a deal to build a 500 MW AI data center with AMD. The catch? They issued 30 million warrants to AMD as part of the transaction. A bitcoin mining company, once bankrupt in 2022, is now placing a half-gigawatt wager on artificial intelligence.
We didn’t ask for a world where bitcoin miners become AI landlords. Yet here we are.
Context
Core Scientific (NASDAQ: CORZ) is one of the largest publicly traded bitcoin miners in North America, operating a fleet of ASICs across Texas, Kentucky, and other states. After emerging from Chapter 11 bankruptcy in early 2024, the company faced a familiar problem: Bitcoin’s halving and volatile price made pure mining less predictable.
The solution? Pivot to high-performance computing (HPC) and AI infrastructure.
AMD, the second-largest AI chip maker after NVIDIA, is hungry for data-center partnerships that can challenge NVIDIA’s near-monopoly. The two companies announced a joint plan to convert existing Core Scientific mining facilities into a 500 MW AI data center, powered by AMD’s Instinct MI300X accelerators.
But the real twist is in the compensation: Core Scientific granted AMD warrants to purchase up to 30 million shares of CORZ stock — a tool that binds the chip maker into the miner’s long-term success.
Core
This move is not just about adding a new revenue stream. It signals a fundamental shift in how we value bitcoin mining assets.
From a technical perspective, repurposing a bitcoin mine for AI is not trivial. ASIC miners are optimized for SHA-256 hashing; they cannot run AI workloads. What miners own is the land, the power contracts (often at $0.03–$0.04/kWh), the cooling infrastructure, and the operational staff. Core Scientific’s 500 MW allocation will require a complete overhaul: liquid cooling loops, high-speed fiber interconnect, and racks designed for GPU clusters.
Yet the economic logic is compelling. AI compute demand is exploding, and traditional cloud providers like AWS and Azure are expensive. By offering bare-metal access to AMD hardware at scale, Core Scientific could undercut hyperscalers by 30–40% while maintaining healthy margins.
But the warrants complicate the narrative.
I spent years auditing token distributions during the 2017 ICO craze. I saw how insider allocations poisoned decentralization. Now I see warrants — a classic Wall Street instrument — being used to align a chip supplier with a miner. AMD will profit not only from selling chips but also from the appreciation of CORZ stock. That is a double win for AMD and a double risk for existing shareholders.
We didn’t build this industry to replicate Wall Street’s favoritism. A warrant for AMD is a silent vote for centralization — where the entity that controls the hardware also controls a chunk of the equity.
Contrarian
Here is the counterintuitive angle: This deal actually weakens Core Scientific’s independence, making it more dependent on a single chip vendor.
Bitcoin mining thrived on ASIC fungibility — miners could switch between Bitmain, MicroBT, or Canaan. But AI compute is sticky: once you build a data center around AMD’s ROCm software stack, migrating to NVIDIA becomes expensive and slow. The warrants deepen that lock-in. AMD now has a financial incentive to ensure Core Scientific succeeds, but it also has a seat at the table when strategic decisions are made.
We didn’t need another middleman between compute and creativity. But the market seems to disagree.
Furthermore, the 30 million warrants, at current CORZ prices (~$12 as of mid-2025), represent a potential dilution of roughly 15–18% of existing shares. If AMD exercises them all, common shareholders lose proportional value unless the company’s market cap grows enough to offset dilution. That is a huge ask for a company that must spend billions on capital expenditure to build the data center.
And what about the rest of the mining ecosystem? Other operators like Riot Platforms and Marathon Digital are watching. They will either copy this model — triggering a race to secure AI partnerships — or get left behind. This could lead to a concentration of scarce power resources in the hands of a few large players, replicating the very centralization that bitcoin was designed to resist.
Takeaway
The shift from bitcoin mining to AI infrastructure is not inherently evil. It may be the only way for publicly traded mining companies to survive the next cycle. But it comes with trade-offs that we must name: technical lock-in, financial dilution, and a departure from the decentralized ethos that many of us hold dear.
As I wrote in my 2024 ETF series, we cannot afford to lose our principles while chasing institutional adoption. The moment we hand over control to AMD in exchange for a GPU lease, we are no longer building a permissionless future. We are just renting a high-end server from a landlord who happens to also own our shares.
So watch the warrants. Watch the construction delays. And ask yourself: Is this progress, or is it just another form of extraction dressed in AI hype?
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