On June 4, 2026, Nscale laid an extremely expanded "AI Story" on the table: cumulative financing nearly $4 billion, with $2 billion raised in just the C round, and a valuation from a single source estimated at around $14.6 billion—yet its origin comes from a very "old world" link: it was spun off from Arkon Energy, a cryptocurrency mining company deeply involved in mining infrastructure, which no longer mines but focuses on building and operating AI data centers, renting computational power on demand to enterprise clients. At the same time, when the primary and secondary markets gave high valuations to high-growth tech assets like SpaceX and Ramp, there were even rumors that Nvidia was one of its investors, making AI infrastructure seem like a new "money printer." However, on the other side, Bridgewater founder Ray Dalio poured cold water on the situation during the same time frame: all great technologies will produce bubbles, and the current bubble around artificial intelligence is nearing the level of tech stocks in 2000, which will eventually burst. Once everyone is eager to turn their paper wealth into cash, the game will abruptly stop. When a computing power company emerging from a bitcoin mining facility is sought after with a private valuation far exceeding that of most listed mining companies, and BTC/ETH are still classified into the same "tech growth risk pool," a new competitive landscape is forming: capital and power facilities no longer naturally belong to miners, and AI infrastructure is competing for the same funding budgets and physical resources as bitcoin. Therefore, in this round of redistribution of computing power and narratives, to what extent will the valuation anchors, risk premiums, and funding flows of BTC/ETH be rewritten, to consider the market as truly pricing the cost and return of this migration.
From Mining Farm to Data Center: Nscale's Signal of Transformation
If we were to symbolize this round of migration of computing power as a company, Nscale is almost the most typical example: it did not emerge from nowhere as a new AI startup but was spun off from Arkon Energy's cryptocurrency mining business, rewriting the narrative of "power + facility + cooling" originally designed for bitcoin into the story of "AI data centers." The business model has fundamentally restructured—Nscale now emphasizes that its core business is no longer self-mining but renting AI computing power resources to enterprise clients, changing the revenue model from "producing BTC" to "charging for computing power rental," which itself is a clear vote for yield: from the perspective of current capital, using the same physical resources to pursue AI demand has a perceived return superior to continuing traditional bitcoin mining.
This vote has been further amplified in the figures of the primary market. Nscale has raised nearly $4 billion in total, with $2 billion raised in just the C round, and its valuation pointed at around $14.6 billion from a single source—a spinoff of a mining company that can achieve such scale and multiples in the private markets indicates that the asset class of "computing power infrastructure" is enjoying significant premiums. More importantly, public information shows that Nvidia and others have entered its shareholder list. After the chip giant at the top of the AI computing industry chain personally got involved, the transformation from "mining farm to data center" is no longer just a few mining companies' individual choices but is being shaped into a mainstream direction backed by industrial capital. For miners still holding substantial amounts of electricity and facilities, this means a new benchmark has been established: it’s not a question of "whether to do AI," but "at what valuation levels and how many resources to allocate for AI," and this benchmark will become a reference point as the BTC computing power supply, mining company equity valuations, and the entire crypto asset risk premium structure are repriced by the market.
Dalio's Warning Amidst AI Frenzy: How To Evaporate Bubbles into Crypto
In Ray Dalio's framework, "all great technological revolutions will give rise to bubbles," and AI is merely the latest iteration: the technology is real, and the bubbles are real. He bluntly states that the current bubble around artificial intelligence is nearing the level of the year 2000 and warns that "wealth is not money... once everyone is eager to turn their paper wealth into cash, the bubble will burst." Applying this statement to Nscale provides a more intuitive view of the height of this wave of sentiment—an AI data center company spun off from mining infrastructure, securing $2 billion in a single C round, accumulating nearly $4 billion in financing, with a valuation pushed to about $14.6 billion (according to a single source); at the same time, valuations of high-growth tech companies like Ramp have been elevated to hundreds of billions of dollars, and SpaceX has launched its IPO roadshow, with both the secondary and primary markets using real money to price "future tech capacity," while the term "bubble" has begun to appear frequently in discourse.
In the bubble expansion phase, the "paper wealth" effect that Dalio discussed amplifies the risk appetite across the entire pool of tech risk assets: AI infrastructure, growth stocks, and unlisted tech unicorns are all elevated in valuation, with BTC and ETH being incorporated into the same basket by more institutions as part of a bet on future technology paradigms. Funds toggling between AI concept stocks and leading crypto assets suggest more of an "in-sector rotation" rather than a "risk retreat." As long as the narrative continues to grow, short-term price pullbacks are often seen as buying opportunities. Yet once it enters the phase he described as "everyone wanting to turn their paper wealth into cash," high Beta assets will face indiscriminate sell-offs: tech stocks in the U.S. will deflate the bubble, followed by overvalued AI infrastructure and crypto assets. BTC and ETH, being some of the most liquid and easily traded tech risk assets, often serve as amplifiers during the bubble period, as well as the first to be used for cashing out when the bubble bursts.
The Battle for Power and Computing: The Real Choices for Bitcoin Miners
When the AI bubble brings all tech assets to the same table, the first layer of reality facing bitcoin miners is the competition for the "same territory." AI data centers and mining farms follow almost the same formula for site selection: the lowest possible electricity prices, the coolest possible climates, and the most stable high-power distribution, combined with mature cooling systems and facility operation capabilities. Arkon Energy previously laid down this entire set of underlying infrastructure for mining, which after being spun off into Nscale is now used to host AI computing power, fundamentally switching the use of the same electricity and facility from “mining BTC” to “running models.” As the valuation of the AI infrastructure track has been pushed higher, the bidding for power, land, and cooling capacity naturally escalates, and the original cost advantages in the areas where bitcoin mining operates are being repriced. Miners now have to calculate a new internal rate of return between "continuing to mine" and "transforming to general or AI data centers."
In recent years, mining companies in North America and other regions have already attempted to utilize part of their facilities and power resources for high-performance computing and AI hosting. Nscale’s complete pivot to AI data centers from Arkon Energy is a typical paradigm amplified by capital regarding this trend. For these miners, the income structure shifting from reliance on BTC block rewards and transaction fees to receiving computing power rental fees priced in fiat currency means their dependence on the rise of bitcoin prices is diminishing: they can hold fewer coins and lock in more long-term hosting contracts, leading to smoother cash flows. However, this also brings two opposite chain effects: on one hand, some mining operations may shut down or reduce output, which could pressure the overall network's hash rate growth in the medium to long term and increase the mining profit margins of remaining miners; on the other hand, during the asset migration period from mining machines to GPUs and from mining farms to data centers, older miners might increase BTC sell-offs in a phased manner to cash out and reduce leverage, creating additional selling pressure. Thus, bitcoin will no longer be merely the "ultimate buyer of power," but will compete against another high-valued tech asset for the same electricity during the AI infrastructure cycle, with its security budget, supply rhythms, and risk premiums being repriced as miners reallocate their assets.
How Funding Prices Bitcoin Within the Pool of Tech Risks
From a funding perspective, Nscale’s cumulative financing of nearly $4 billion essentially pulls a group of global institutions and high-net-worth individuals, who would have been willing to buy mining machines, stocks in computing power, or BTC/ETH, into a broader "tech risk pool." Betting on computing power and infrastructure, capital can now make horizontal comparisons between AI data center projects like Nscale, financial technology companies like Ramp whose valuations have reached $44 billion, and various growth tech stocks: under which metrics can units of risk yield greater "tech explosion" exposure. With a limited annual risk budget, such a massive financing for AI infrastructure will inevitably crowd out part of the funding that could otherwise flow into the primary market for crypto tracks, especially those equity projects aligned in logic with Nscale, such as "on-chain infrastructure" and "computing power + energy," which could face contraction in pricing and shares.
But this does not mean BTC/ETH are entirely abandoned; rather, they are being more clearly bundled into the same tech risk basket in the secondary market. On the same day, SpaceX launched its IPO roadshow, planning to issue 555 million Class A common shares at $135 per share. Adding case studies like Ramp and Nscale indicates that demand for growth tech assets in the global primary and secondary markets is currently high. In this environment, BTC, which over the past few years has demonstrated directional correlation with the Nasdaq tech stock index, is perceived by many funds as a "high Beta tech exposure": when sentiments toward AI and tech stocks are high, more allocation towards these elastic assets is made to amplify portfolio returns; when concerns over the AI bubble rise and overall risk appetites decline, BTC/ETH are reduced along with overvalued tech stocks. Therefore, Nscale absorbs a portion of crypto infrastructure's chips in the primary market, but in the secondary market, it arguably participates in rewriting the risk premiums and volatility structure of BTC/ETH relative to other tech assets by raising the overall temperature of the tech risk pool.
Signals to Watch for Traders Amid a Bubble-Driven Market
From the spin-off of cryptocurrency mining from Arkon Energy to disclosing nearly $4 billion in cumulative financing as of June 4, 2026, with a valuation of about $14.6 billion (according to a single source), Nscale clarifies one thing through the path of "spun off from mining companies, landing as an AI unicorn": the same set of electricity, facilities, cooling, and operation assets has a valuation multiple in the AI infrastructure track far higher than the cash flow discounting for remaining in bitcoin mining. This means that in the long-term game, mining capital and management indeed have a new real option—changing computing power, or even the company itself, from "security budget producers" to "AI computing power service providers," thus altering part of the supply-side assumptions of bitcoin security budgets: future new electricity and facilities may not necessarily prioritize hash rates but might preferentially supply the overvalued AI sector. If the AI bubble continues to expand along the path described by Dalio as "nearing the level of 2000," Nscale-type narratives will strengthen this tilt: more mining companies will spin off or transform, more electricity locked for GPU clusters, and the security of the BTC network will increasingly rely on raising prices and transaction fees to "squeeze" enough computational power; yet once the bubble bursts at the moment "everyone is eager to turn their paper wealth into cash," it would be logical to see high Beta tech stocks and BTC/ETH being reduced together, with tech and crypto both going through deleveraging. For crypto traders, it is crucial to closely monitor three types of signals: first, changes in business structure disclosed by public companies and large miners—the scissor gap between AI hosting, high-performance computing revenue percentages, and mining revenue percentages, and whether new CapEx is invested in GPUs or ASICs; second, the heat of financing and valuation levels of AI infrastructure companies like Nscale in both primary and secondary markets, with the degree of resonance with valuations of growth tech assets like Ramp and SpaceX, to judge whether the entire tech risk pool is entering an overheating zone; third, the rhythm of macro liquidity and shifts in risk appetite, especially changes in correlation between BTC/ETH and tech stocks during phases of significant ups and downs—only by considering these signals collectively can one determine whether they are currently riding the tailwind brought by the AI bubble for bitcoin or standing at the forefront of a potential simultaneous deleveraging of tech and crypto.
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