Bitcoin company of fallen crypto king FTX gets new life through AI

A Bitcoin mining company that once received more than a billion dollars from the collapsed crypto platform FTX is getting a striking new future. Genesis Digital Assets comes into the hands of investment company SWI Group, which wants to use the infrastructure for artificial intelligence (AI). This gives a company from one of the biggest scandals in crypto history a second life.

Genesis Digital Assets made money mining Bitcoin (BTC) for years. In addition, companies use large amounts of computers to process transactions on the Bitcoin network and earn new bitcoins.

These activities require a lot of electricity and specialised data centres. It is precisely this infrastructure that is also of interest to companies developing AI today.

SWI Group therefore wants to take a different direction. The investment company has announced that it will end the Bitcoin mining activities of Genesis Digital Assets. The existing locations in the United States and Sweden need to be converted into data centers for large technology companies.

The plans coincide with a new capital injection. SWI Group has raised 800 million euros, equivalent to about 900 million dollars, to expand its activities in the field of AI data centers.

Investors reacted enthusiastically to the news. SWI Group shares rose by about sixteen percent.

The switch shows how the growing demand for AI infrastructure is creating new opportunities for companies that were originally active in the crypto sector.

The history of Genesis Digital Assets is closely intertwined with that of Sam Bankman-Fried, the founder of crypto exchange FTX.

Through his trading company Alameda Research, Bankman-Fried invested more than a billion dollars in Genesis Digital Assets. With this, Alameda acquired a stake of about twenty percent in the mining company.

When FTX collapsed in November 2022, that investment also came under a magnifying glass.

The administrators of the bankrupt crypto exchange later tried to recover about 1.15 billion dollars from Genesis Digital Assets through a lawsuit. According to the indictment, the investments were part of the financial problems that ultimately led to the demise of FTX.

That legal battle came to an end last June, when the lawsuit was withdrawn.

Meanwhile, SWI Group further expanded its position in Genesis Digital Assets. After an earlier investment of $500 million in June, the investment company acquired a majority stake in the company.

For Genesis Digital Assets, the acquisition means that the future is no longer about producing new bitcoins, but about providing computing power for AI.

The transition from Genesis Digital Assets to Artificial Intelligence is not the first time that a former FTX investment has played an unexpected role in the AI sector.

Bankman-Fried also invested in Anthropic, the company behind AI assistant Claude, via FTX.

That investment grew strongly in value after the rise of artificial intelligence. Based on subsequent valuations, the original interest could now be worth about $75 billion.

The bankruptcy estate of FTX does not fully benefit from this. The managers sold the stake in Anthropic as early as 2024 for about 1.3 billion dollars, in order to free up money for the creditors of the collapsed crypto exchange.

Bankman-Fried himself is now serving a 25-year prison sentence for his role in the FTX fraud.

The developments at Genesis Digital Assets underline how fast the market for data centers is changing. While cheap electricity and large computer halls have been of particular interest to Bitcoin miners for years, interest from the AI industry is now growing.

For SWI Group, the future of the former FTX investment therefore does not lie with Bitcoin, but with the technology that requires more and more computing power worldwide.