TeraWulf Jumps 7% as CEO Pushes Back on Stranded Data Center Fears; Cipher Digital Rises 3%, Applied Digital Edges Higher
TeraWulf's CEO fired back at analysts calling his unfinished data centers stranded assets, and his argument rests on a build sequence that he says most critics are getting backwards.
A weekend response from TeraWulf‘s (NASDAQ:WULF) chief executive is lifting the former Bitcoin miners now racing to build AI data centers, with TeraWulf shares leading the charge. The pushback targets a worry that has weighed on the group: some sites could end up without tenants, power or interconnection. TeraWulf shares are at $12.15 in morning trading, up 7% as the market reassesses fears that partially built data centers could leave computing capacity stranded.
Even with the rebound, TeraWulf stock is down 26% over the past month, so the gain recovers only part of that decline. Meanwhile, Cipher Digital (NASDAQ:CIFR) shares are up 3% to $8.17, a smaller advance that trails TeraWulf’s move. Applied Digital (NASDAQ:APLD) shares are up 2% to $18.63, the most modest gain of the three data center builders.
The CoinShares Bitcoin Mining and Digital Power ETF (NASDAQ:WGMI) is up 3% to $30, giving a read on the sector. That’s well ahead of the SPDR S&P 500 ETF Trust (NYSEARCA:SPY), which is up 0.9% to $767.08, showing the AI infrastructure group recovering alongside a stronger market while also outpacing it.
Prager Rejects the Stranded Data Center Narrative
Over the weekend, TeraWulf chief executive Paul Prager pushed back on warnings that partially built data centers will leave computing capacity stranded. His case rests on sequencing, since TeraWulf secures power, fixed-price construction contracts, long-term tenants with investment-grade backing and financing before it builds. Prager wrote, “We may move dirt early, but we don’t build on spec.”
Prager made his stance clear. In the same pushback, he maintained that “what others call stranded assets, we may call a development pipeline.” Late last week, TeraWulf also expanded its senior secured revolving credit facility, giving the company more borrowing capacity for its AI data center expansion. Taken together, the message and the larger credit line offer a concrete answer to the funding question hanging over TeraWulf’s unfinished sites.
Mining Roots Set TeraWulf and Cipher Digital Apart From Applied Digital
TeraWulf, Cipher Digital and Applied Digital all build data center capacity for AI and high-performance computing customers. Both TeraWulf and Cipher Digital are converting from Bitcoin mining, while Applied Digital built its business around hosting computing workloads. That shared origin puts TeraWulf and Cipher Digital in the same debate over how converted mining sites get financed and filled.
Contracted tenants anchor TeraWulf’s argument, including a long-term Anthropic lease at its Justified Data Campus in Kentucky and existing operations at its Lake Mariner campus in New York. Prager’s “development pipeline” line also covers earlier-stage TeraWulf sites such as the Muskie Data Campus in Kentucky and the Chesapeake Data Campus in Maryland. Cipher Digital has its own contracted campuses, including Black Pearl and Barber Lake, as it moves away from mining.
Applied Digital’s hosting background gives it a different profile. The company runs an HPC Hosting segment serving hyperscale customers and a Data Center Hosting segment that provides energized space to crypto mining customers.
What TeraWulf’s Financing-First Model Means for Its Recovery
TeraWulf’s next test is whether its financing-first approach keeps its projects on schedule amid broader questions about how AI data centers get funded (we covered seven companies supplying that expansion, from power to cooling, in a free report here). The milestones to watch are construction progress at Lake Mariner and Justified, along with any draw on the expanded credit facility.
On the risk side, TeraWulf still runs a legacy mining business it’s repurposing for high-performance computing, and its sites take time to turn into lease revenue, while the expanded borrowing capacity at TeraWulf also adds obligations that pay off only if tenants move in on schedule.
Cipher Digital’s contracted campuses support its case, but it faces the same conversion and financing questions, and Applied Digital’s hyperscale customers are an advantage, though its crypto mining hosting segment keeps it tied to a volatile sector. Prager’s no-spec pledge sets a clear standard for measuring TeraWulf in the quarters ahead.
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David Moadel is financial writer specializing in stocks, ETFs, options, precious metals, and Bitcoin. David has written well over 1,000 articles for leading online publications, helping investors understand markets, income strategies, and risk.His work has appeared in The Motley Fool, InvestorPlace, U.S. News & World Report, TipRanks, ValueWalk, Benzinga, Market Realist, TalkMarkets, Finmasters, 24/7 Wall St., and others.With a master’s degree in education, David has taught at the elementary, high school, and college levels. That teaching background shapes his writing style: clear, educational, and practical. David has also built a loyal social-media audience by providing trustworthy financial content on YouTube, X/Twitter, and StockTwits.
