July 23, 2024
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Microsoft Pens AI Cloud Computing Deal with Former Ethereum Miner CoreWeave: CNBC

Microsoft has entered into a groundbreaking partnership with CoreWeave, a former Ethereum miner, to enhance its Artificial Intelligence (AI) services by utilizing CoreWeave’s advanced cloud computing infrastructure. This landmark agreement, reportedly worth billions of dollars, spanned multiple years and was confirmed by insiders familiar with the matter, as revealed by a recent CNBC report on June 1.

Sources close to the deal disclosed that Microsoft and CoreWeave inked the agreement earlier this year, shortly after the phenomenal success of Microsoft OpenAI’s immensely popular ChatGPT chatbot. With the exponential growth of AI technology over the past year, Microsoft has successfully introduced a range of AI-powered services. Notably, Microsoft integrated GPT-4 into its web browsers, Bing and Microsoft Edge, eliminating the waitlist for this innovative feature.

Microsoft’s collaboration with CoreWeave is further bolstered by its existing partnership with OpenAI, which relies on Microsoft’s Azure cloud computing infrastructure to handle its extensive computational demands. This synergy ensures a robust and efficient AI ecosystem, leveraging the expertise and resources of both companies.

Originally established as an Ethereum miner in 2017, CoreWeave initially employed graphics processing units (GPUs) to validate transactions on the Ethereum network during its early stages as a proof-of-work blockchain. However, in 2019, CoreWeave recognized an unmet need in the market for competitively priced, scalable, and diverse computing options. Consequently, the company transitioned its focus to cloud GPU computing, capitalizing on this opportunity while asserting that traditional providers could not deliver comparable services.

The announcement of the Microsoft partnership follows CoreWeave’s recent extension of its Series B funding round, securing an additional $200 million to reach total funding of $421 million. This funding round, led by Magnetar Capital and supported by longstanding strategic partner NVIDIA, will primarily be utilized to expand CoreWeave’s cloud infrastructure. With a specific emphasis on AI, machine learning, visual effects, rendering, and other computational workloads, CoreWeave aims to position itself as a leading player in the global tech landscape.

Bitcoin advocate and Castle Island Ventures general partner Nic Carter expressed his thoughts on the Microsoft-CoreWeave collaboration via Twitter. He underscored the remarkable transformation of CoreWeave from an Ethereum mining operation to an AI compute powerhouse, emphasizing the company’s meteoric rise in value to over $2 billion and its current status as one of the world’s fastest-growing enterprises.

Microsoft’s groundbreaking partnership with CoreWeave marks a significant milestone in AI and cloud computing. By leveraging CoreWeave’s cutting-edge infrastructure, Microsoft is poised to enhance its AI-powered services, ensuring exceptional performance and scalability. This collaboration propels both companies to the forefront of technological innovation, solidifying their positions as industry leaders in AI’s fast-paced and ever-evolving world.