Leading Bitcoin (BTC) Mining Company, Riot Platforms, Adds Over $500M in BTC to Its Holdings

Riot Platforms, a leading bitcoin mining company, added a substantial amount of BTC, worth approximately $510 million, to its holdings. Between December 10 and 12, Riot bought roughly $510 million in Bitcoin, bringing the total value of its BTC holdings to nearly $1.7 billion. 

Leading bitcoin mining company Riot Platform recently raised $525 million to fund a significant addition to its BTC holdings, which now totals nearly $1.7 billion. The purchase comes just days after activist investor Starboard Value announced it had taken a significant stake in the bitcoin-mining company. 

Starboard Value Takes “Significant Position” in Riot Platforms

Riot Platforms, a leading bitcoin mining company, has purchased an additional $510 million in Bitcoin to add to its holdings. Riot Platform announced that with the proceeds from a recent fundraising that netted the company $525 million, $510 million would be used to purchase 5,117 BTC at an average rate of $99,669 per BTC. The purchase brings Riot’s total holdings to 16,728 BTC. 

With the net proceeds from Riot’s recent $525 million, 0.75% coupon convertible bond issue, the Company has acquired 5,117 BTC at an average price of $99,669 per BTC, inclusive of fees and expenses. As a result, Riot has increased its holdings to 16,728 BTC, currently valued at… pic.twitter.com/Fi6x5hnNDR

— Riot Platforms, Inc. (@RiotPlatforms) December 13, 2024

The purchase comes after activist investor Starboard Value took a “significant position” in the company. According to the Wall Street Journal, no financial details were disclosed, but the news of Starboard’s stake boosted Riot’s shares significantly. The WSJ reported that Starboard urged Riot Platforms to repurpose some of its Bitcoin mining capacity to service artificial intelligence models, and Riot’s purchase may have been due to pressure from Starboard as buying BTC has shown itself to be a way for miners to win over their investors. 

Riot reportedly told the WSJ:

“We are committed to creating value for all shareholders, and we look forward to constructive dialogue with Starboard on ways to achieve this shared goal.”

Shifting Focus to Artificial Intelligence

The burgeoning artificial intelligence (AI) market has progressed and become more integrated into most business and technology aspects. As the sector continues to expand, the demand for computational power from AI is rising, and the Bitcoin mining industry is well-equipped to service this need. To service their own enterprise, Bitcoin and crypto miners are equipped with expansive data centres and captive power supplies, making them the ideal candidates for AI involvement. According to the reports from the WSJ, Starboard Value wants Riot to convert some of its bitcoin-mining facilities into space for big data centre users.  

According to a report from asset fund manager VanEck, Riot could gain an estimated $4.8 billion in market capitalization by pivoting to AI businesses, which would more than double the company’s current market cap. Matthew Sigel, head of digital assets research at VanEck, explained the logic behind pivoting to AI,

“The synergy is simple: AI companies need energy, and Bitcoin miners have it.”

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

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