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With falling rates and the potential for the NVDA-2.69%  rally to extend into next week’s earnings, our AI/HPC miner equities basket presents an attractive risk/reward in the near-term. Below, we highlight the performance of CORZ-2.17%  (a leader in HPC compute among Bitcoin miners) versus MARA-2.96%  (which lacks HPC services). This ratio has roughly tracked NVDA's price since early Q2. While rates and BTC1.40%  will continue to impact all miner stocks, HPC miners can benefit from any surges in the AI narrative in traditional markets as well.

HPC miner cohort rebounding STRONGLY today following the drawdown of the past couple weeks. This is despite BTC really only moving from $60k-$62k. We still like these names, HUT-2.55% , CORZ-2.17% , WULF-4.90% , IREN3.22% , HIVE-3.37% , BTBT-1.04% , given tailwinds from both AI and BTC1.40% .

Core Scientific (CORZ-2.17% ) announced a new contract with CoreWeave for an additional 70 MW of infrastructure to support high-performance computing (HPC) operations, increasing their total HPC hosting capacity to 270 MW. This agreement modifies 100 MW of existing infrastructure to host CoreWeave’s NVIDIA GPUs, with modifications starting in late 2024 and operations expected by late 2025. The 12-year contract is projected to add $1.225 billion in revenue over the lifetime of the contract. CoreWeave will fund the necessary capital investments. This move reflects miners' strategy to diversify into HPC using existing infrastructure and energy contracts. CORZ is up 6% on the news, despite higher rates and a lower BTC1.40%  price this morning.

The ongoing surge in the DXY, which began with the hot NFP numbers on Friday and is being exacerbated by the relative EUR weakness today, continues to weigh on crypto prices. However, there is a bright spot found in the miners today. Three of the names we added to our recommended crypto equities last week as part of our HPC + AI basket are in the green (IREN3.22% , WULF-4.90% , CORZ-2.17% ), with IREN leading the way, up about 15% today as the market starts to appreciate the opportunity for miners to leverage their capacity to serve HPC markets. We think it is right to lean into this strength.

WGMI-1.25%  is up over 10% today, driven by strong performances from constituents like CORZ-2.17%  and WULF-4.90% . These companies are receiving significant interest today due to their initiatives to diversify into AI/HPC compute hosting. CORZ-2.17%  has been working on diversifying its capacity for some time, but today's announced hosting deal with CoreWeave led to a 40% increase in its share price, and broader investor attention towards the intersection of BTC1.40%  and HPC.