Canaan Inc. has deepened its presence in the United States after acquiring a 49% equity stake in three Bitcoin mining projects in West Texas from Cipher Mining for $39.75 million.
Key Takeaways
- Canaan bought Cipher’s 49% stake in three Texas mining sites for $39.75M.
- The projects total 120 MW and 4.4 EH/s of hashrate.
- Payment was made entirely in shares, with a six-month lock-up.
The transaction, finalized on February 23, 2026, reshapes the priorities of both firms – with Canaan strengthening its role as a direct operator, while Cipher redirects capital toward artificial intelligence and high-performance computing infrastructure.
The assets, commonly referred to as the “ABC Projects,” represent a combined 120 megawatts of power capacity and are tied to long-term energy arrangements within Texas’ competitive power market.
Project Portfolio and Operational Scale
The three entities included in the deal are:
- Alborz LLC – Located near Happy, Texas, and integrated with off-grid wind generation.
- Bear LLC – Situated near Andrews, Texas.
- Chief Mountain LLC – Also based near Andrews.
Together, the sites deliver approximately 4.4 EH/s of hashrate with an average fleet efficiency of 25.7 J/TH. Access to power priced below 3 cents per kilowatt-hour gives Canaan a cost advantage as mining economics remain sensitive to Bitcoin price swings and network difficulty.
Deal Structure and Ownership
Rather than using cash, Canaan funded the entire $39.75 million purchase through equity. The company issued 806.4 million Class A ordinary shares to Cipher, equivalent to roughly 53.8 million American Depositary Shares priced at $0.7394 each. The shares are subject to a six-month lock-up period.
Following the transaction, Canaan holds a 49% stake in the joint venture, while WindHQ LLC maintains majority ownership at 51%.
In a related move, Canaan repurchased 6,840 Avalon A15Pro-AVG-221T mining machines that had been operating at Cipher’s Black Pearl site. That facility is now being converted into an AI-focused data center, underscoring Cipher’s broader strategic pivot.
Strategic Implications for Both Companies
For Canaan, the acquisition marks a transition away from being primarily a mining hardware manufacturer toward a vertically integrated operator with direct exposure to U.S.-based infrastructure. The Texas expansion secures long-term access to renewable and low-cost energy on the ERCOT grid, strengthening operational resilience.
For Cipher, divesting its stake in the West Texas joint venture unlocks capital as it shifts attention to AI and HPC operations. The company has been repositioning major sites, including its 300 MW Black Pearl facility, to meet rising demand for data center capacity tied to artificial intelligence workloads.
Financial Context
The expansion comes shortly after Canaan reported record fourth-quarter 2025 revenue of $196.3 million, fueled by shipments of more than 50,000 A15 Pro mining machines. Despite the revenue milestone, the company posted an $85 million net loss, largely driven by inventory write-downs and Bitcoin price volatility.
By increasing its direct exposure to energy-efficient mining assets in Texas, Canaan appears to be betting that operational scale and low power costs can help stabilize margins in a highly cyclical market.
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Source: https://coindoo.com/bitcoin-mining-company-canaan-expands-texas-operations-with-40m-deal/