Hut 8 Expands Into AI: How It’s Diversifying Beyond Mining

• Hut 8’s GPU-as-a-Service launch diversifies its business into AI and cloud computing beyond Bitcoin mining.
• This move aims to drive revenue growth and build a sustainable model amid challenges in the Bitcoin mining industry.

Hut 8, a major player in the crypto mining industry, has launched its GPU-as-a-Service company, which is now fully operational after deploying a cluster of 1,000 NVIDIA H100 GPUs at a Tier 3 data center in Chicago.

Our GPU-as-a-Service vertical is officially live following the deployment of our first cluster.

“The launch of our GPU-as-a-service vertical further diversifies our compute layer, which now spans AI compute, Bitcoin mining, and traditional cloud services. Consistent with our… pic.twitter.com/jaC6Hu3WG2

— Hut 8 (@Hut8Corp) September 26, 2024

Hut 8 Strategic Shift Into AI Marks a Bold Expansion Beyond Bitcoin Mining

Highrise AI, Inc., a subsidiary of Hut 8, is in charge of running the service after completing the implementation in collaboration with Hewlett Packard Enterprise (HPE) and AdvizeX.

The company signed a five-year contract with an AI cloud developer that includes fixed infrastructure fees as well as revenue sharing, establishing this venture as a critical component of Hut 8’s growth plan.

The introduction of this GPU-as-a-Service signals a significant move for Hut 8 as it expands its computational offerings. CEO Asher Genoot noted that this move is consistent with the company’s goal of building a well-structured AI compute business that would be financially and strategically valuable.

This project, in particular, is intended to boost topline growth, diversify revenue streams, and build long-term value for Hut 8, as it moves beyond the limits of Bitcoin mining.

Hut 8’s move to enter the AI computing market comes as the Bitcoin mining sector faces growing obstacles. Following the April 2024 Bitcoin halving, mining payouts were reduced from 6.25 BTC to 3.125 BTC, dramatically lowering miners’ income.

As a result, the network’s hashrate and mining difficulty have reached all-time highs, reducing earnings for many mining facilities. Hut 8 has deliberately positioned itself to avoid the financial risks associated with Bitcoin’s unpredictable mining incentives, displaying agility in a quickly changing market.

Affordable GPU Access for AI Developers and Startups 

The new service offers a tremendous opportunity for developers, particularly those in AI and startups, who may struggle to obtain or buy such high-performance GPU clusters. As global demand for GPUs such as the NVIDIA H100 grows, Hut 8’s service presents a low-cost option to owning and maintaining expensive infrastructure.

The business’s choice to use its computing infrastructure expertise to provide AI services indicates a broader commitment to growing its capabilities beyond cryptocurrency mining, making this a significant step toward becoming a more diverse technological company.

Hut 8’s recent attempts reflect its desire to optimize earnings on its energy assets and digital infrastructure portfolio in the face of escalating operational costs in Bitcoin mining.

According to the research, the cost of mining a single Bitcoin has more than doubled in only one year, rising from $11,321 in Q2 2023 to $26,232 in Q2 2024. Hut 8 intends to develop a resilient and sustainable company model by leveraging AI and cloud services, mitigating the effects of the halving and assuring continuous growth.

The company underlined its commitment to expanding into AI and cloud computing by raising $150 million from an investment firm earlier this year to fund its move into serving AI customers.