Key Facts

  • VanEck said Wednesday that so-called powered shell providers, Bitcoin miners leasing sites to AI tenants, fell about 35% in October even though no signed leases were cancelled.

  • The firm’s Griffin MacMaster and Matthew Sigel said cap-rate and lease-value math implies 42% to 103% upside for Cipher, TeraWulf, and Hut 8 specifically.

  • VanEck also flagged risks, including up to $3.2 billion of added equity needs through 2028 and a possible Texas moratorium on new data centers.

VanEck said Wednesday that so-called powered shell providers, Bitcoin miners leasing sites to AI tenants, fell about 35% in October even though no signed leases were cancelled.

The firm’s Griffin MacMaster and Matthew Sigel said cap-rate and lease-value math implies 42% to 103% upside for Cipher, TeraWulf, and Hut 8 specifically.

VanEck also flagged risks, including up to $3.2 billion of added equity needs through 2028 and a possible Texas moratorium on new data centers.

VanEck tied the slide to a hotter-than-expected September inflation reading and regulatory uncertainty ahead of the Nov. 3 midterm elections, both of which revived rate-hike expectations and pushed up borrowing costs; CoreWeave bonds were trading near 15% against coupons under 10%, the firm said.

Cap-Rate Math Implies 42% to 103% Upside

On 2028 estimates, the group trades at roughly half the enterprise-value-to-EBITDA multiple of data-center real estate investment trusts (REITs), VanEck said. Valuing each company’s first full year of stabilized lease income at real-estate-style multiples implies 42% to 103% upside for Cipher, TeraWulf, and Hut 8, the three names VanEck modeled individually, which closed Oct. 30 between 55% and 75% below their 2026 highs.

VanEck Flags Funding and Political Risks

VanEck said real risks remain. A wave of construction-loan refinancing may slip to 2029 or 2030, leaving the next round of leases needing $600 million to $3.2 billion in new equity, pointing to smaller refinancings already completed by IREN and HIVE Digital as evidence debt markets remain open but selective.

Political risk is also rising. Texas Governor-elect Hinojosa has floated a moratorium on new data centers in a state that VanEck says holds about 30% of US data-center capacity currently under construction.