Luxor raised $16 million to expand computing power for AI

Luxor Technology, which built its business around bitcoin mining, has raised $16 million to expand into the artificial intelligence computing power market – another sign that crypto infrastructure companies are moving into AI. The round was led by CMT Digital, the venture arm of Chicago's CMT Group; mining equipment manufacturers Canaan and MicroBT, as well as Halo, Steelhead, and angel investors participated.

The round combined primary and secondary capital. Luxor described each investor as an operational partner already embedded in the computing supply chain – equipment, capital, and energy.

The round followed the September launch of Luxor AI – a segment that extends the energy, equipment, software, and trading stack built for bitcoin mining to the AI and high-performance computing market. The company has significant operational experience: its hardware desk has traded $1 billion in ASIC devices, its energy division serves over 75 MW of load across two US power grid regions, and its cloud platform processed 1.8 million workloads from the beginning of the year to September.

The funds will be directed towards scaling the cloud platform, working capital for the AI equipment business, developing computing derivatives trading, and hiring engineers and go-to-market specialists. A separate element is the over-the-counter desk, which already offers settlement options, forwards, and hedging tools on computing lease indices, turning AI computing power into an asset that can be valued and hedged as a financial instrument.

"Computing markets are converging: the same miners, energy sites, and capital that served digital mining now power AI," said Nick Hansen, CEO and co-founder of Luxor.

The move fits into the broader pivot of the mining industry towards AI: miners are repurposing energy and infrastructure, some are signing billion-dollar deals with hyperscalers, some are selling bitcoin to finance the transition. Analysts at VanEck and Bernstein have identified miners as likely energy suppliers in the AI race due to their rare access to electricity and sites needed by data centers.

Luxor serves miners, including Canaan and TeraWulf, and has expanded its hardware business to supply GPUs and AI servers as global chip supply chains become increasingly complex. In June 2021, the company raised $5 million in a Series A round led by NYDIG; early investors included Celsius, Valour, and Bitnomial, according to Tracxn.