Bitcoin Mining Co. CleanSpark Targets $1.15 Billion in New Capital Amid AI Pivot

CleanSpark, a Nasdaq-listed Bitcoin mining firm, announced a $1.15 billion convertible note offering to fund its expansion and data-center projects.

The zero-coupon notes, due 2032, carry a 27.5% conversion premium. They give investors an option to purchase up to $150 million more in a greenshoe period.

CleanSpark said it will use about $460 million of the proceeds to buy back common stock and dedicate the balance to growing its power and land holdings, building new AI-focused data centers, and repaying debt lines.

This capital raise comes as CleanSpark builds out an AI infrastructure division. It recently announced 285-megawatt data-center campus in Texas – and aims to shore up its balance sheet.

CleanSpark Raises $1.15B Convertible Note for AI Infrastructure

CleanSpark’s $1.15 billion offering upsizes a prior plan and reflects strong investor demand. The notes do not pay interest but can be converted into shares (or cash) beginning in mid-2031.

At pricing on Nov. 10, CleanSpark stock closed at $15.03, implying an initial conversion price around $19.16 per share (27.5% above that close).

By contrast, prior offerings by TeraWulf and other miners were smaller. In announcing the deal, CleanSpark executives highlighted that roughly $460 million will be used to repurchase shares from the convertible note investors at the offering price.

The remaining funds (roughly $670–$820 million, depending on exercise of the option) will finance expansion of CleanSpark’s mining and AI operations – notably the new 285 MW Texas AI data campus.

From Bitcoin Mining To AI Infrastructure Provider

Management remains focused on using the fresh capital to reduce debt and invest for growth. In particular, the notes will help repay a $200 million bitcoin-backed credit facility.

It will also support strategic partnerships (e.g. a liquid-cooling pilot with Submer) that bolster its AI compute offering.

Overall, CleanSpark is positioning itself as a “Bitcoin miner turned AI infrastructure provider.”

The Company is betting that future shareholder returns will come from a mix of BTC mining and hosting AI workloads.

Bitcoin’s 2024 “halving” cut miners’ new token rewards in half, tightening margins even as crypto prices rallied to new heights.

Today, a single block pays 3.125 BTC instead of 6.25 BTC, so any given hash now earns less BTC. In combination with rising mining difficulty, this has squeezed profitability.

As one industry analysis notes, higher network difficulty and volatile crypto prices have eroded mining margins.

In fact, recent data show bitcoin mining difficulty climbing steadily. Meaning miners must share rewards with more rivals and higher costs.

Fluctuating crypto prices add to the uncertainty – a sudden price drop can wipe out narrow margins for outfits that depend purely on block subsidies.

In this backdrop, miners are turning to AI and data-center workloads as an alternative revenue stream. AI offers an “alternative revenue” source when crypto prices are unstable.

Major Bitcoin Miners Strike AI Deals

CleanSpark is not alone. Bitcoin mining peers are redeploying their assets with big AI contracts and projects. For example:

IREN (formerly Iris Energy) – In early November, Microsoft announced a $9.7 billion, five-year agreement to purchase AI cloud capacity from IREN.

Under the deal, IREN will host Nvidia GB300-based AI systems for Microsoft in Texas data centers. It has committed to buying $5.8 billion in GPUs from Dell to fuel those systems.

TeraWulf (WULF) – Earlier this fall, TeraWulf announced up to $575 million in convertible notes (including a $75M greenshoe) to fund its AI expansion.

Proceeds will finance a 168-MW Texas data center in partnership with Fluidstack, a Google-backed cloud compute firm, which has agreed to a $9.5 billion joint venture for that site.

Like CleanSpark, TeraWulf is shifting focus from pure bitcoin mining to mixed-use data operations. Its stock reacted to these moves: after TeraWulf unveiled the convertible deal (on the heels of a 17% stock surge from the initial JV news), shares were slightly lower, suggesting short-term pressure from debt issuance.

These examples show a clear pattern: bitcoin miners and ex-miners are striking multibillion-dollar AI deals.

In each case, management argues that their existing power agreements and computer farms are valuable for AI workloads.

The convertible debt raises (CleanSpark, TeraWulf) and hosting contracts (IREN, Core Scientific) all reflect a strategy to blend crypto mining with digital infrastructure services.

By branching into AI, these companies reduce their dependence on one volatility factor – crypto prices, They can tap into the rapidly growing market for AI compute.