Bitcoin Miners Expanding Into AI Plunge More Than 12% After U.S. Inflation Shock

Shares of Bitcoin miners expanding into AI infrastructure plunged across the board after stronger-than-expected U.S. inflation data revived concerns about higher interest rates. The selloff also highlighted the burden of data-center investment financed with heavy borrowing.

TeraWulf fell 12.64% in U.S. trading on October 14 from the previous session. Core Scientific and Cipher Mining dropped 12.44% and 12.35%, respectively. IREN lost 12.2%, while Riot Platforms, Bitdeer, Mara Holdings and CleanSpark also came under pressure.

The drop in mining stocks coincided with a broader selloff in AI infrastructure names. Data-center operator CoreWeave fell about 16%, while AI infrastructure company Nebius dropped about 11%. Oracle also lost about 9%. Investors sold companies that had been ramping up spending on expectations of rising AI demand.

Higher rates can add to funding pressure for those companies. Building data centers and securing equipment require massive spending, leaving heavily indebted companies more exposed to rising interest costs. Many miners have also been expanding into AI infrastructure, making it difficult for them to escape those concerns.

The selloff was triggered by the U.S. consumer price index for September. The annual inflation rate came in at 3.7%, above the market expectation of 3.6%. Rising gasoline prices linked to the war in the Middle East pushed inflation higher and intensified concerns that the Federal Reserve could tighten further. The probability of an October rate hike briefly climbed above 50% before retreating later in the day.

Sentiment across technology stocks also weakened. The S&P 500 fell 1.11%, marking its biggest one-day drop since July 29. The Nasdaq Composite slid 1.88%, its steepest decline since July 23. The Dow Jones Industrial Average lost 0.09%.