Neoclouds Take Different Paths From Crypto Mining to AI

Neoclouds sell GPU computing for AI workloads, and their crypto ties range from early Ethereum mining to current efforts to retire Bitcoin (BTC) equipment and redirect power and data-center capacity.

A neocloud lets AI developers rent computing capacity instead of building and operating every part of the system themselves. Providers combine graphics processing units (GPUs) with data centers, networking and software. CoreWeave and Nebius focus on GPU capacity, while IREN offers bare-metal computing and managed cloud services for AI training and inference.

GPUs can handle many calculations at once, making them useful for training models and running them to produce results. Large workloads also depend on fast connections between GPUs, along with facilities that supply electricity and cooling. Those needs make power and data-center capacity central to delivering AI computing, alongside the chips themselves.

The link to crypto differs by company. CoreWeave’s early history includes acquiring a GPU and mining an Ethereum block in 2016. Ethereum completed its move from proof of work to proof of stake on Sept. 15, 2022, ending mining on the network. That history describes an early use of GPUs; it is distinct from the AI computing services neoclouds provide today.

IREN is taking a different route. During the year ended June 30, 2026, it began decommissioning Bitcoin-mining equipment and redirecting power and data-center capacity toward AI cloud services. It aims to substantially complete the transition by Dec. 31, 2026. The shift involves retiring mining hardware and reallocating infrastructure; Bitcoin-mining machines themselves do not become AI GPUs.

Companies also differ in what they sell. IREN provides cloud computing services, while TeraWulf has agreed to lease AI infrastructure capacity to Anthropic at a planned campus in Kentucky. The 20-year lease covers about 401 megawatts of critical IT load. It is an infrastructure lease, rather than an agreement for managed GPU cloud services.

A separate IREN agreement shows the cloud-services model. In November 2025, IREN announced a five-year GPU cloud services contract with Microsoft valued at about $9.7 billion. The agreement included a 20% prepayment. IREN also planned to purchase about $5.8 billion in GPUs and related equipment for the contract.

The expansion also carries substantial costs. For the quarter ended June 30, 2026, CoreWeave recorded $2.575 billion in revenue, $1.393 billion in depreciation and amortization, $640 million in net interest expense and a $626 million net loss. These figures show that one provider recorded substantial equipment and financing costs alongside $2.575 billion in quarterly revenue; they do not establish profitability across the neocloud sector.

The next milestones are IREN’s target to substantially complete its transition by Dec. 31, 2026, and TeraWulf’s planned campus rollout. Initial capacity is expected in the second half of 2027, with the full 401 megawatts expected to reach capacity by early 2028.