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Post: Core Scientific’s Strategic Move: Leasing Hewlett Packard Data Center for High-Performance Computing Expansion

Core Scientific’s Strategic Move: Leasing Hewlett Packard Data Center for High-Performance Computing Expansion

Key Points:

  • Core Scientific leases former Hewlett Packard data center in Austin, Texas, for hosting CoreWeave’s infrastructure.
  • 16 MW of capacity will be provided for high-performance computing (HPC) expansion.
  • The deal between Core Scientific and CoreWeave aims to diversify revenue streams, anticipating the upcoming Bitcoin halving.
  • CoreWeave, an AI cloud computing company, is backed by major financial firms and offers services for compute-intensive tasks like machine learning.

Core Scientific Leases Hewlett Packard Data Center:

Core Scientific has secured a lease for a tier 3 data center previously owned by Hewlett Packard in Austin, Texas. This arrangement is intended to serve as the hosting location for CoreWeave’s infrastructure, marking a strategic move by Core Scientific to support high-performance computing expansion by offering up to 16 MW of capacity.

Core Scientific & CoreWeave Collaboration for Revenue Diversification:

In preparation for the upcoming Bitcoin halving event, Core Scientific has partnered with CoreWeave, an AI cloud computing company. This collaboration is designed to diversify revenue streams and could generate over $100 million in potential revenue. By venturing into high-performance computing services, Core Scientific aims to capitalize on market opportunities beyond cryptocurrency mining.

CoreWeave’s Valuation and Backing by Major Financial Firms:

CoreWeave, the recipient of data center services from Core Scientific, boasts a valuation of $7 billion as of the end of December 2023. The AI cloud computing company has garnered support from significant financial entities like Jane Street, J.P. Morgan Asset Management, and Fidelity. This backing underscores the confidence in CoreWeave’s business model and its ability to cater to demanding compute-intensive tasks such as machine learning.

Hot Take:

Core Scientific’s decision to expand into high-performance computing through its partnership with CoreWeave is a strategic move to tap into new revenue streams. By leveraging its expertise in data center operations and collaborating with a prominent AI company like CoreWeave, Core Scientific is positioning itself for growth beyond the cryptocurrency mining sector.

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