Activist investor Starboard Value is pushing for bitcoin miner Riot to flex into AI, too
In a fun convergence of current thing 1 and current thing 2, activist investor Starboard Value has taken a “significant position” in publicly traded bitcoin miner Riot Platforms.
The investing group wants the miner to diversify from bitcoin mining and convert some of its facilities into data centers for hyperscalers like Amazon and Google, which have seen an explosion in demand thanks to AI.
“We have engaged with Starboard on multiple occasions and welcome their input on the company,” a company spokesperson told Sherwood News. “We are committed to creating value for all shareholders, and we look forward to constructive dialogue with Starboard on ways to achieve this shared goal.”
It’s an interesting proposal: despite bitcoin being up 130% YTD, Riot’s stock is down 17%, largely because of the recent bitcoin halving, which cut the block reward (the number of bitcoins miners received for adding new blocks to the blockchain) in half, from 6.25 bitcoin to 3.125.
It wouldn’t even be the first time Riot pivoted its business to the hot new thing, as prior to mining bitcoin the company was Riot Blockchain, and prior to that it was a biotech play.
Another formerly bankrupt bitcoin miner, Core Scientific, has seen its stock price boom, climbing 365% this year, thanks in large part to it refocusing on AI infrastructure. Core Scientific signed multiple deals with CoreWeave, an Nvidia-backed startup that provides tech for the chipmaker’s AI models, to provide computing power.
While ASICs, the rigs used to mine bitcoin, are different from the GPUs needed to power AI models, Core Scientific has shown that the change is both feasible and profitable, and Starboard wants Riot to make a similar move.
Updated at 4:25 p.m. ET with comments from the company.
“We have engaged with Starboard on multiple occasions and welcome their input on the company,” a company spokesperson told Sherwood News. “We are committed to creating value for all shareholders, and we look forward to constructive dialogue with Starboard on ways to achieve this shared goal.”
It’s an interesting proposal: despite bitcoin being up 130% YTD, Riot’s stock is down 17%, largely because of the recent bitcoin halving, which cut the block reward (the number of bitcoins miners received for adding new blocks to the blockchain) in half, from 6.25 bitcoin to 3.125.
It wouldn’t even be the first time Riot pivoted its business to the hot new thing, as prior to mining bitcoin the company was Riot Blockchain, and prior to that it was a biotech play.
Another formerly bankrupt bitcoin miner, Core Scientific, has seen its stock price boom, climbing 365% this year, thanks in large part to it refocusing on AI infrastructure. Core Scientific signed multiple deals with CoreWeave, an Nvidia-backed startup that provides tech for the chipmaker’s AI models, to provide computing power.
While ASICs, the rigs used to mine bitcoin, are different from the GPUs needed to power AI models, Core Scientific has shown that the change is both feasible and profitable, and Starboard wants Riot to make a similar move.
Updated at 4:25 p.m. ET with comments from the company.
