Cipher Mining Inc (NASDAQ: CIFR) has received $50 million in investment from SoftBank which it said will help it build more data centers in the United States.
The Japanese investment firm bought over 10 million shares to become a “significant primary investor” in CIFR today.
Additionally, the Bitcoin miner signed a one-month exclusivity agreement with SoftBank this morning that disables it from selling its Barber Lake site to another party.
Cipher Mining stock rallied as much as 30% following the news on Friday.
What SoftBank investment means for CIFR
CIFR sees the new investment as a tailwind for its HPC data center development business.
High-performance computing data centers are specialized facilities designed to handle intensive computational tasks that require immense processing power. According to Tyler Page – the company’s chief executive:
This investment comes at a pivotal moment in Cipher’s growth trajectory, as we continue to attract attention for our pipeline of sites and innovative solutions in industrial-scale data centres.
Ultimately, the Nasdaq-listed firm wants to position itself as the leader in HPC systems.
Despite a sharp surge this morning, Cipher Mining stock that does not currently pay a dividend is still down more than 20% versus its high in mid-December.
Is it too late to invest in Cipher Mining stock?
The SoftBank news made analysts at JPMorgan reiterate their “overweight” rating on CIFR.
While $50 million may not be immensely significant in the context of HPC data centers, the investment “could be a sign of things to come,” they noted in a research note on Friday.
Simply put, the Japanese firm’s investment signals a broader interest in the emerging technology and that’s what makes owning Cipher Mining stock an exciting investment proposition at current levels.
The news arrived only days after DeepSeek launched a new, open-source AI model that it claims is more powerful than any other LLM out there and requires significantly fewer resources to build and operate.
The Chinese startup’s announcement triggered a sharp sell-off in the US bitcoin mining stocks.
How Cipher did in its latest reported quarter
According to JPMorgan, the SoftBank deal “validates continued demand and interest in large sites with power agreements in place.”
The investment firm remains bullish on CIFR shares even though the company reported a not so encouraging financial results for its third quarter in early November.
Cipher Mining saw its revenue come in at $24 million in Q3 – down about 21% on a year-over-year basis as net loss widened by an alarming 390%.
At the time, CEO Tyler Page told investors:
We’ve created a pathway to become one of the largest data centre developers by finalising the purchase of options to acquire three new sites.
Note that at one point last year, CIFR was reported to be considering a sale after receiving a takeover bid.
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