Google acquires 5.4% stake in Cipher Mining worth $1.4

Google has locked in the right to buy 5.4% of Cipher Mining, a crypto data center company based in New York, through a multi-year infrastructure deal that could end up pulling in $7 billion for Cipher if all terms play out.

The agreement is tied to a 10-year lease contract between Cipher and UK-based Fluidstack, where Google guaranteed $1.4 billion of Fluidstack’s obligations. That guarantee gave Google the option to grab equity in Cipher, worth about $1.4 billion.

The deal is the second time in two months that Google and Fluidstack have teamed up, as demand for high-performance compute to run artificial intelligence models keeps surging.

Google, which already spends tens of billions yearly building its own data centers, has started looking outside (just like Microsoft) to lock in capacity through newer AI cloud infrastructure players. Fluidstack is one of them, despite having little track record and only recently entering the market.

Cipher plans to borrow using Google’s guarantee

Cipher said the guaranteed payments from Google will allow it to raise additional debt and speed up its expansion. The company’s data centers were originally used to mine crypto, but that hardware setup (power, land, cooling) now makes them a perfect fit to support the AI race.

Under the contract, Fluidstack will pay Cipher $3 billion over ten years. But the fine print includes two five-year extension options that would add another $4 billion in revenue. Cipher’s total potential haul? $7 billion, if all goes well.

After the announcement, Cipher’s stock jumped 24% in premarket trading, then settled at $14.14 by market close on Wednesday. Its share price has more than tripled in 2025 alone.

This isn’t Google’s first time playing this game. The company struck a nearly identical deal with TeraWulf, another crypto-mining operator now refitting itself for AI hosting. That contract also involved Fluidstack and included warrants for Google to buy up to 14% of TeraWulf. Both deals show Google’s strategy: cover Fluidstack’s leases, get equity in the hardware firms, and gain priority access to cloud capacity without building new data centers itself.

Earlier this year, Fluidstack announced its involvement in a €10 billion ($11.8 billion) supercomputer project in France. No one knows yet how that project’s going, but it’s clear Fluidstack is trying to position itself as a major AI compute supplier, even without a long history in the space.

Alphabet’s AI expansion helps lift stock price

Alphabet, Google’s parent company, is sitting just below the top of the tech market. The company’s market cap is currently just under $3 trillion, placing it behind only Nvidia ($4.3T), Microsoft ($3.79T), and Apple ($3.74T). Shares have risen more than 30% in 2025, and are up over 70% from April. That growth beat the Nasdaq 100 Index, which is up 17% this year.

Analyst Michael Nathanson of MoffettNathanson said Alphabet should be taken seriously as a contender for the top spot. “The combination of market leadership, diversification, and scale positions Alphabet not only as a winner in the GenAI era but as a company that should rightly be considered for the title of most valuable company in the world,” Nathanson said. He raised his price target on Alphabet’s stock from $230 to $295, just short of the $300 Street-high, and maintained a buy rating. He cited the company’s strength in multimodal search and its ability to deliver new AI tools fast.

Investors are also breathing easier after Alphabet escaped a brutal antitrust crackdown earlier this month. A U.S. judge refused to force the sale of its Chrome browser, removing a serious legal threat that’s been hanging over the company for years. That legal win comes on top of a strong second-quarter earnings report, where sales from AI-linked products gave revenue a noticeable lift.

Nathanson added that Google’s entire GenAI strategy has now gone fully offensive. “No longer cautious, Google has accelerated its GenAI product cycle, pushing out launches at pace. We view this as a turning point: from reactive to proactive, and now dictating the tempo of innovation.”

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