Riot Platforms Faces Increased Activist Investor Interest
Bitcoin mining company Riot Platforms (RIOT) has recently become the focus of attention from a second activist investor, as Reuters reports that investment management powerhouse D.E. Shaw has acquired an unspecified stake in the firm. This development comes on the heels of another activist investor, Starboard Value, which manages approximately $9 billion in assets, taking a position in Riot just weeks earlier.
At the time of Starboard’s investment, the Wall Street Journal highlighted that Starboard was advocating for Riot to transform a portion of its bitcoin mining operations into data centers. These centers would ideally host machines capable of supporting high-performance computing (HPC) for major technology companies. While Reuters did not clarify whether D.E. Shaw intends to exert similar pressure on Riot, it is worth noting that the investment firm has a history of engaging in activist strategies, often preferring to negotiate behind the scenes.
Earlier this month, Riot Platforms announced that it had initiated a formal evaluation of potential uses for artificial intelligence and HPC concerning its remaining 600 megawatts (MW) of power capacity at one of its facilities. This move reflects a broader trend within the bitcoin mining sector, which has been grappling with severe profit constraints following this year’s bitcoin halving event, which significantly reduced mining profitability. Consequently, many miners are exploring diversified revenue streams as a means of sustaining their operations.
Despite a recent surge of optimism in investor sentiment and stock prices following Core Scientific’s (CORZ) multi-billion dollar agreement with a hyperscaler—a company that manages large-scale data centers for cloud computing and AI—the enthusiasm quickly dissipated. This shift occurred with the announcement of China’s DeepSeek, which reportedly requires only a fraction of the computing power that U.S.-based AI companies were initially believed to need. As a result, Core Scientific’s stock has plummeted by approximately 30% since Monday. In the same timeframe, Riot Platforms has experienced a decline of about 18%, and its stock performance has remained relatively flat on a year-over-year basis. However, shares of RIOT have seen a modest increase of 1% today.
