Iris Energy Has Committed Most of Childress Site to Expansion of Bitcoin Mining: Bernstein

As a researcher with experience in the tech and energy industries, I find the recent developments surrounding Iris Energy (IREN) intriguing. The 14% drop in Iris Energy’s share price following a short-selling report from Culper Research that questioned the suitability of its Childress site for artificial intelligence (AI) or high-performance computing (HPC) is concerning, but it’s essential to consider the context.As a crypto investor, I was taken aback when Iris Energy (IREN) shares plummeted by nearly 14% the previous day. The cause of this sudden decline was a short-selling report released by Culper Research. The report raised concerns about the Childress, Texas site operated by Iris Energy, stating that it may not be ideal for artificial intelligence (AI) or high-performance computing (HPC).

In a recent research report, investment firm Bernstein noted that the company has primarily dedicated its planned expansion at the site towards Bitcoin (BTC) mining. Fortunately, the current power and data center setup at the location are ideally suited for this new endeavor.

According to the broker’s assessment, approximately two-thirds (65%) of the company’s worth comes from its bitcoin mining operations. The remaining third (35%) stems from AI and HPC sectors. Bernstein strongly refutes the belief that the mining aspect holds no value.

The primary benefits of AI for Iris Energy are largely attributed to its 1.4 gigawatt solar farm in West Texas, which features a power interconnect. The value stems mainly from the profitable utilization of the site’s land and the provision of power.

The broker explained that Iris Energy’s present investment of $1 million per megawatt in capital expenditures specifically pertains to Bitcoin mining, making direct comparisons with Artificial Intelligence (AI) or High Performance Computing (HPC) capex an unmeaningful exercise.