Riot Platforms used to live and die by the price of bitcoin… but I have a feeling CEO Jason Les is feeling pretty good about the company’s decision to pivot into AI infrastructure right about now.

Shares jumped more than 20% Tuesday after the company struck a 20-year agreement to provide Anthropic with 191 megawatts of computing capacity at its Rockdale, Texas campus. It’s important to note… the stock later gave back nearly all of that gain, but the deal itself is enormous.

Riot expects the agreement to generate $9.1 billion in revenue through June 2048. If Anthropic sticks around for two optional five-year extensions, the total could climb to $16.1 billion (if nothing changes).

So what exactly is Riot selling here? Well, Riot is essentially leasing Anthropic the power and physical infrastructure required to train and operate its models.

Anthropic, OpenAI and the rest of the industry can buy all the advanced chips they want. Those chips are useless without enormous data centers, reliable connections to the electrical grid and enough power to keep everything running.

Riot already has all three because bitcoin mining requires many of the same ingredients.

That’s why bitcoin miners are discovering they may have been sitting on a better business all along. Stop using all that power to mine bitcoin, rent it to AI companies instead, and collect checks for the next few decades.

The change also comes at a good time for Riot.

Bitcoin mining has become a much tougher business as crypto prices have fallen, competition has increased and Bitcoin’s recurring halving events have reduced the number of coins miners receive.

For instance, during the second quarter, Riot’s bitcoin mining revenue fell to $113.7 million from $140.9 million a year earlier. Once depreciation was included, the company also spent more mining each bitcoin than those coins were worth when they were produced.

AI data centers offer a potentially steadier alternative.

Riot estimates the Anthropic agreement will generate between $7.3 billion and $8.2 billion in cumulative net operating income over its initial 20-year term. That works out to an average of $365 million to $411 million annually.

And Anthropic won’t be alone at the Rockdale campus.

Riot already has an agreement with AMD, which leases 50 megawatts at the same site. Combined, the two tenants represent 241 megawatts of contracted capacity and approximately $9.8 billion in long-term data center revenue.

Hut 8 and TeraWulf now operate as hybrids, splitting their attention between crypto mining and AI infrastructure.

Until now, Riot had remained much closer to a traditional bitcoin miner alongside MARA Holdings and CleanSpark. This deal officially pulls it into the hybrid camp.

And Riot may have picked the perfect time to start renting out that power.

Texas grid operator ERCOT is taking a much harder look at new power projects, which could leave proposed data centers waiting longer to get connected. AI companies still need the electricity, though, and Riot already has a massive amount of it approved and ready to go.

That puts the company in a pretty enviable position.

But investors clearly aren’t convinced the job is finished. Riot shares gave back nearly all of their initial 20% jump because signing a $9.1 billion contract and actually delivering on it are two very different things.

The facilities still need to be built, the capacity must be delivered and the revenue has to turn into real profits. 

But compared with mining bitcoin and hoping the price covers the electric bill, a 20-year tenant like Anthropic isn’t a bad backup plan. 

At the time of publishing this article, Stocks.News holds positions in Bitcoin as mentioned in the article.