Cipher Digital raises $810M in junk bonds to build another Amazon data centre in Texas
What's the deal? Cipher Digital is selling $810 million in high-yield bonds at roughly 6.25% to finance its Stingray Facility, a 100-megawatt data centre in Andrews County, West Texas. Amazon will lease the site for 15 years. Morgan StanleyDealroom has a profile for this one. Try Dealroom →, Goldman SachsDealroom has a profile for this one. Try Dealroom →, Wells Fargo, Banco Santander, and SMBC Nikko SecuritiesDealroom has a profile for this one. Try Dealroom → are managing the offering.
The deal has an unusual twist: rather than fixed annual repayments, the amortisation schedule is tied to the cash the project generates after completion — making it more akin to project finance than traditional junk debt.
Cipher Digital, formerly Cipher Mining, pivoted from cryptocurrency mining to high-performance computing infrastructure, decommissioning its bitcoin operations in February. It now holds roughly 600 megawatts of contracted HPC capacity with AWS, Google, and Fluidstack, and claims approximately $11.4 billion in contracted revenue across its portfolio.
Why now? This is Cipher's third high-yield bond sale in four months. In February, its Black Pearl Compute subsidiary raised $2 billion in a deal that drew more than $13 billion in orders — a 6.5-to-one oversubscription ratio showing just how hungry fixed-income investors are for AI infrastructure exposure.
The $810 million offering landed on the same day Amazon launched a C$14 billion ($10 billion) investment-grade bond sale in Canadian dollars — the largest corporate bond offering ever in that currency. The parallel deals spotlight the two-track debt market powering AI buildout: hyperscalers borrow at investment-grade rates while smaller builders like Cipher tap junk markets at 6–8%.
What could go wrong? These instruments look different from typical junk bonds. Cipher's Amazon leases are triple-net agreements with no termination-for-convenience clauses, meaning Amazon pays rent for the full 15-year term regardless of whether it needs the capacity. That contracted, investment-grade-backed revenue lowers risk — but it also means investors are betting on Amazon's long-term creditworthiness and on sustained demand for AI compute over the next decade and a half.
The signal: Cipher's pivot from bitcoin mining to hyperscaler-backed data centres — and its ability to raise nearly $3 billion in high-yield debt in just four months — illustrates how quickly capital markets have rewired around AI infrastructure. The bookrunner lineup spanning Morgan Stanley, Goldman Sachs, Wells Fargo, Banco Santander, and SMBC Nikko Securities underscores that arranging AI-linked debt has become a global, cross-institutional priority, drawing in corporate banks and investment funds alike as they compete for a share of what is fast becoming the dominant growth segment in fixed-income markets.
Read more: thenextweb.com
