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Microsoft has reportedly entered into an agreement with CoreWeave, a former Ethereum miner, to leverage its artificial intelligence (AI)-powered services with CoreWeave’s cloud computing infrastructure.

As per a report dated June 1 that cites “people with knowledge of the matter,” Microsoft is most likely going to spend billions of dollars on this deal with CoreWeave for a period spanning multiple years.

One of the sources of CNBC claimed that the deal was signed earlier in 2023.

In the midst of AI technology growing rapidly over the past 12 months, Microsoft has launched many different AI-powered services. A key example of such launches would be the integration of OpenAI’s GPT-4 with its web browsers Bing and Microsoft Edge, for which the company recently axed the waitlist.

OpenAI also utilises Azure, the cloud computing infrastructure of Microsoft, for handling its sizable computing requirements.

CoreWeave had begun its operations as an Ethereum miner in 2017, by utilising graphics processing units (GPUs) for validating transactions on Ethereum during its growing days as a proof-of-work blockchain.

In around 2019, the company started shifting its focus on cloud GPU computing after it spotted a gap in the market for competitively priced, scalable and varied computing options. It claimed that this was something which legacy providers were not providing.

Just a few days after CoreWeave revealed that it had extended its $221 million Series B funding round from April so as to get the total amount to $421 million, the deal with Microsoft was reported. The Series B funding was led by Magnetar Capital, along with the participation of long-standing strategic partner Nvidia.

The company stated in April that the capital it raised would be used for expanding its cloud infrastructure that is focused on a broad range of computational workloads like artificial intelligence(AI), machine learning, and visual effects.

Bitcoin advocate and Castle Island Ventures general partner, Nic Carter, commented on the Microsoft deal via Twitter, throwing light on the importance of the company’s change of industry:

“Ppl make fun of ‘crypto to AI pivots’ but CoreWeave went from mining ETH to using their fleet to do compute for AI and now they’re worth $2b+... one of the fastest growing companies in the world right now.”

Shashank is the founder of yMedia. He ventured into crypto in 2013 and is an ETH maximalist. Twitter: @bhardwajshash