"Mining alone is not enough"...Mara Holdings (MARA) invests $600 million in AI

▲ Bitcoin (BTC), Cryptocurrency Mining, Artificial Intelligence (AI), Data Center/AI Generated Image

Bitcoin (BTC) mining giant Mara Holdings (MARA) is investing up to $600 million to acquire a large power site in Texas, setting its sights on the artificial intelligence (AI) data center market.

According to cryptocurrency media outlet BeInCrypto on July 9 (local time), Mara Holdings signed an agreement with fuel developer HIF Global to acquire a power site in Matagorda County, Texas. The deal size could reach up to $600 million if target conditions are met. The site spans over 1,200 acres and, subject to ERCOT approval, can secure up to 1 GW of grid capacity by October 2027 and up to 2 GW by April 2028.

The site was originally planned as the first large-scale green fuel plant in the United States. It was a roughly $7 billion project supported by Texas Governor Greg Abbott, aiming to produce fuel for shipping by splitting water and recycling carbon dioxide. HIF Global has already secured all permits and rights to connect to a roughly 1.8 GW power grid and will retain a minority stake after the transaction.

The key aspect Mara Holdings targeted is flexibility in power operations. ERCOT, the Texas grid operator, saw connection queue requests increase by approximately 300% over the past year, with most of this demand coming from data centers. Mara Holdings is partnering with Starwood Digital Ventures to build a campus on the site. The strategy is to operate mining equipment when Bitcoin prices are high and supply power to AI operators at other times. Based on the full 2 GW capacity, the cost to secure 1 MW of grid capacity is approximately $300,000.

Fred Thiel, Chairman and CEO of Mara Holdings, stated in an April filing, “Power is a scarce input resource in AI. We are building a differentiated platform to maximize the value of every megawatt we control.” The transaction payments will also be made in stages, with a significant portion dependent on the approval process and the execution of lease agreements.

Mara Holdings is also expected to finalize a $1.5 billion deal to acquire the 505 MW Long Ridge gas power plant in Ohio. Combining these two projects, the company's potential power capacity could increase to approximately 4.8 GW. Securing future tenants and generating stable revenue will be key variables determining the success of the $600 million Texas investment.

[Article Summary]

-Mara Holdings is investing up to $600 million to acquire a power site of over 1,200 acres in Texas.

-The site can secure up to 2 GW of grid capacity by April 2028 and will be used for Bitcoin mining and supplying power to AI operators.

-Mara Holdings plans to expand its potential power capacity to approximately 4.8 GW, including the Ohio power plant deal.

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