Riot Platforms is once again under the spotlight. This time, it's due to an activist investor named D.E. Shaw. They've built a stake in the Bitcoin mining company and are pushing for some changes.
D.E. Shaw is a well-known investment firm based in Manhattan. They manage around $70 billion in assets. Their strategy often involves quietly negotiating with company executives rather than making their demands public.
This isn't the first time Riot has faced pressure from investors. Recently, another hedge fund, Starboard Value, took a significant position in Riot. They have suggested that Riot should reallocate some of its Bitcoin mining operations to support large data centers, especially as interest in artificial intelligence continues to grow. Riot has confirmed that they’ve had discussions with Starboard.
Many crypto miners are adapting to the market. They’re finding ways to rent out parts of their operations to support AI initiatives. This shift comes as the difficulty of mining Bitcoin increases and competition tightens.
On January 21, Riot announced plans to review its operations. They’re considering switching over 600 megawatts of power at their Corsicana, Texas site to support AI and high-performance computing. Currently, that site uses 400 megawatts just for Bitcoin mining.
As for the stock, on January 29, shares of Riot Platforms (RIOT) rose nearly 2.5% to $11.22. This ended a two-day losing streak that affected other public crypto miners as well. So far this year, RIOT has gained nearly 10%, but it’s down about 3% over the last 12 months due to challenges in achieving net income.
There's some optimism in the crypto sector. Many are hopeful that promises from U.S. President Donald Trump to reduce regulatory oversight and boost local Bitcoin mining will help the industry grow.
Interestingly, Riot has also engaged in its own activist investing. Last year, they attempted to acquire rival Bitcoin miner Bitfarms and built up a significant stake. However, they agreed to end that hostile takeover late last year.