The former Bitcoin (CRYPTO:BTC) miners that rebuilt themselves as AI data-center landlords are getting squeezed from two sides Thursday. Bitcoin is sliding again, and long-term borrowing costs keep climbing for a group that funds its buildouts with debt.
Shares of Cipher Digital Inc. (NASDAQ:CIFR), Riot Platforms Inc. (NASDAQ:RIOT), CleanSpark Inc. (NASDAQ:CLSK), IREN Ltd. (NASDAQ:IREN), TeraWulf Inc. (NASDAQ:WULF), Nebius Group N.V. (NASDAQ:NBIS) and Applied Digital Corp. (NASDAQ:APLD) all traded lower in the morning session. Most sit roughly 50% or more below their 52-week highs.
- IREN stock is moving. See the real-time price action here.
Bond Market Bites
The 30-year Treasury yield rose more than 4 basis points to 5.705% Thursday morning after trading just below a 24-year high in the prior session, according to Trading Economics. The 10-year yield touched its highest level since 2002 on Wednesday.
Minutes from the latest Federal Reserve meeting showed officials expect to raise rates again before year-end, and investors are betting on a hike on Dec. 9.
Higher yields hurt the neocloud group twice. Debt gets more expensive, and long-dated lease income is worth less in today’s dollars.
The borrowing is real. Blue Owl Capital led a $2.4 billion financing package for an IREN AI campus in Canada, split between a $1.2 billion senior secured term loan and $1.2 billion of senior secured notes to buy Nvidia equipment.
Under its $9.7 billion Microsoft contract, IREN needs to spend $5.8 billion on chips and $3 billion on other costs, according to Reuters, and has lined up $3.7 billion in chip financing.
Bitcoin Still Matters
Bitcoin traded near $82,496 midmorning, down about 0.9%, after dipping as low as $81,710, per Benzinga Pro. The token is down roughly 35% from its 52-week high of $126,296.
Miners like Riot and CleanSpark still lean heavily on mining revenue. A weaker bitcoin price squeezes margins while the AI hosting business is still ramping up.
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Rich Multiples, Little Cushion
Valuations add to the pressure. Reuters described Cipher, TeraWulf and Hut 8 Corp. (NASDAQ:HUT) as “powered-shell” landlords signing leases as long as 15 years.
Long leases with built-in rent escalators look safe. But those cash flows stretch years into the future, and the further out they run, the harder rising yields hit their present value.
Neocloud Price Action
Neocloud stocks were sinking in Thursday’s late-morning trading, per Benzinga Pro data:
- Cipher Digital shares were down 7.5% at $13.47, 55.3% below its 52-week high.
- Riot Platforms was down 6.6% at $17.32, 42.9% below its 52-week high.
- CleanSpark shares were down 6.3% at $10.79, 54.3% below its 52-week high.
- TeraWulf was down 5.5% at $13.61, 54.4% below its 52-week high.
- IREN stock was down 5.3% at $36.63, 52.3% below its 52-week high.
- Applied Digital stock was down 3.5% at $22.98, 54.7% below its 52-week high.
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