Jason's Chips
Buy-Side AI & Semiconductor Investor
Core Scientific's second 1.5 GW site expansion shows densification is happening across bitcoin miners turned AI hosts, and more gigawatts per site means more rental revenue. Core Scientific is using a scalable behind-the-meter power solution, apparently Bloom fuel cells, to add capacity at existing sites. Once leasing deals for this capacity are announced at Core Scientific, IREN, Applied Digital, Cipher, TeraWulf and Riot, they should be massive. x.com
Bitcoin miners' scarcest asset for AI is their permitted sites, which gain value as AI scaling shifts to densifying existing sites. Grid power alone is fading as a moat because Bloom Energy's fuel cells are becoming cost-competitive with the grid. But political backlash against AI is stretching permitting from 18 months toward five years. Compute on one site can rise by two orders of magnitude, giving Core Scientific, IREN, Applied Digital, Cipher, TeraWulf and Riot immense pricing power. x.com x.com
Premium-model inference revenue could support much higher compute pricing for AI infrastructure providers. Evercore models over $120M/MW in potential lab revenue while labs pay roughly $30-50M/MW for compute. With power and GPUs scarce, SpaceX AI, Nebius, IREN and CoreWeave can capture the biggest uplift over historical pricing if they deliver contracted high-density capacity. x.com x.com
Contracted AI compute demand makes four AI infrastructure stocks worth buying at 52-week lows. Applied Digital has a $36B backlog and expects 600+ MW online within 12 months; Cipher Mining has $8.5B+ in AI leases with payments ramping; CleanSpark has a 20-year $6.6B lease and 1.8+ GW power portfolio; CoreWeave has a $104B backlog and raised its year-end ARR target to $18.5-19.5B. x.com x.com
Bitcoin miners converting to AI infrastructure, such as IREN and Keel, are likely to be poor trades. For five years they have raised as much capital as possible and spent it on capex with no prospect of return, and the realistic base case is another dilution-fueled capex spree. They failed to generate shareholder returns even when bitcoin soared. The exception is a hard management reset, as at Core Scientific; the rest are run by the same people. Keel fell 9% on a planned $350 million offering. … Show more
Lower AI token prices drive more usage, making GPUs scarcer and raising rental rates for neocloud capacity. Gavin Baker reports rising GPU rental prices even as token prices fall; the GPU constraint never left, and higher rental prices make the ARR math work again. x.com x.com
Bitcoin miners own the scarce asset AI data centers need, grid power, yet their stocks haven't caught up. New US grid connections take 5–7 years, so miners are converting sites into powered shells leased to hyperscalers on 15–25 year fixed-price contracts. Morgan Stanley estimates these return 15–19% a year and create about $15.50 of value per watt, versus market values of $2–4.50 per watt. Analyst targets imply upside of 259% for TeraWulf, 124% for Hut 8, 82% for Cipher and 51% for Riot. x.com
AI infrastructure operators such as Core Scientific, CoreWeave, Galaxy Digital and TeraWulf benefit if out-year gigawatt projections are not met. Constraints on power generation, grid transmission, labor and wafer capacity limit how many debt-financed data centers and chips get built, which is healthier longer term if the build-out is funded from operating cash flow. @LEJCapital counters that this assumes demand keeps growing exponentially and stays far above supply. x.com x.com
Electricity is a clear bottleneck for AI, favoring AI-focused power and data-center infrastructure names over residential utilities. The US could be short 107 GW to power data centers through 2029, while China adds capacity year after year. Medium-term preferences are Cipher, Hut 8, Riot, TeraWulf, Galaxy, Equinix, Bloom Energy, Solaris, Vistra, GE Vernova, INIO, Williams, Liberty Energy, EROC and Cummins. x.com x.com
A rising value of compute per watt should benefit AI cloud, chip, connectivity and power suppliers. Elon Musk says that value will rise over time. Nebius has Microsoft and Meta deals; Marvell benefits from custom silicon demand; Credo connects GPUs; Vistra has long-term nuclear supply deals with Amazon and Meta; Nokia's Nvidia partnership could help it capture data-center networking growth. x.com x.com
Power scarcity and specialized technology could help these six under-$30 stocks create generational wealth over the next decade. MARA is buying a gas plant; IREN has over 5 GW secured for AI growth. Oklo aims to turn spent fuel into reactor supply, while Nano Nuclear's portable microreactors could reach remote sites if they work. Rigetti builds quantum chips in-house and has a $100 million Commerce Department letter of intent. Navitas makes chips that reduce power waste in AI data centers. x.com … Show more
Some AI data-center developers may have to absorb higher financing costs because existing leases have fixed economics and tenants need not pay more. That could reduce equity returns even as compute demand grows. Scarce deliverable power, strong counterparties and favorable financing could instead make the best developers more valuable as marginal projects stall. Vertically integrated infrastructure landowners such as Cipher look attractive; today's prices may be the worst of the selloff. x.com … Show more
