Bitcoin Miner Iris Energy Expanding Capacity in Pivot to AI

On June 20, institutional-grade Bitcoin mining firm Iris Energy announced an expansion plan to 9.1 EH/s (exahashes per second) from its current 5.6 EH/s.

It also stated that there would be a “revitalization” of its high-performance computing (“HPC”) data center strategy.

Iris is a 100% renewable energy Bitcoin miner targeting low-cost, under-utilized renewable energy.

$IREN today announced:– 80MW Childress construction underway, target increase in potential data center capacity from 5.6 EH/s to ~9.1 EH/s by early 2024– Long-lead items to unlock ~13.6 EH/s– Prior HPC data center strategy revitalized– Limited recourse financing update

— Iris Energy (@irisenergyco) June 20, 2023

Bitcoin Mining Firm Pivots to AI

The construction of the remaining 80MW (megawatts) of data centers for its first phase of expansion at its Childress, Texas site is underway. The additional four 20MW data centers are expected to be complete by early 2024, increasing the firm’s capacity by 63%.

Phase two of the expansion will add a further 100MW of capacity, increasing hash power to 13.6 EH/s in the future. The firm stated:

“Near-term focus remains on data center construction, whilst retaining flexibility on timing for miner purchases, which is subject to funding and market conditions.”

The high-performance computing strategy appears to be a pivot into the artificial intelligence (AI) sector, which is all the rage at the moment. Moreover, demand for data center space for AI is estimated to grow to $76 billion by 2028.

The firm noted that significant time was invested in exploring the strategy around 3-4 years ago. This included 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,”

Iris Energy cut its capacity in November 2022 as the bear market reached its lowest point.

Iris Energy stock (IREN) surged 21% on the day to reach $4.19 in after-hours trading. Company shares have skyrocketed more than 250% since the beginning of the year.

Hash Rate Peaks

Bitcoin mining has become harder for smaller operators as hash rates continue to reach new highs. The current average hash rate is 354 EH/s, according to Bitinfocharts. It peaked at 433 EH/s on June 11 and has increased by 32% so far this year.

The difficulty, which measures the competition between miners, is also at an all-time high of 52.35T.

Hash price, or mining profitability, has fallen as a result and is currently $0.07 per TH/s per day, according to Hashrate Index.

Hash prices spiked in May when the Bitcoin ordinal inscription craze crippled the network, but it has fallen 20% over the past 12 months.