# Bitcoin mining bridged Crusoe to AI infrastructure

Markdown copy of https://realalpha.app/s/bitcoin-mining-bridged-crusoe-to-ai-infrastructure/ on Real Alpha, the best minutes from long interviews with the people building AI. Cite and link the page, not this copy.

- Speaker: [Chase Lochmiller](https://realalpha.app/builders/chase-lochmiller/) · Chase Lochmiller is CEO of Crusoe. · Co-founded Crusoe in 2018 on the bet that energy would be AI's biggest bottleneck, and builds the data centers.
- Host: [Sonya Huang](https://realalpha.app/people/sonya-huang/) · Partner, Sequoia Capital · Works with OpenAI and Anthropic; co-wrote Sequoia's essay on generative AI.
- Host: [Pat Grady](https://realalpha.app/people/pat-grady/) · Co-steward, Sequoia Capital · Joined Sequoia in 2007; backed Snowflake, Zoom, ServiceNow and OpenAI.
- Show: Training Data
- Episode: [Crusoe CEO Chase Lochmiller: Turning Stranded Energy Into Intelligence](https://realalpha.app/v/64vUl9k-IAQ/), Oct 29, 2026
- Moment: 24:06 to 32:16 of the episode (8 min), playing on https://realalpha.app/s/bitcoin-mining-bridged-crusoe-to-ai-infrastructure/; the episode from there: https://realalpha.app/v/64vUl9k-IAQ/?t=1446

## Quote

> “this was sort of the **plan all along** was this energy first approach to computing.”
> — [Chase Lochmiller](https://realalpha.app/builders/chase-lochmiller/) at [24:20](https://realalpha.app/v/64vUl9k-IAQ/?t=1460) · Training Data

## Takeaways

1. Crusoe’s energy-first computing thesis came before Bitcoin mining.
2. Bitcoin was an early way to monetize stranded energy.
3. Selling the mining business let Crusoe focus on AI infrastructure.

## About this segment

Chase Lochmiller says Crusoe’s energy-first computing thesis predated its Bitcoin business, which turned stranded gas into revenue. After ChatGPT accelerated demand for AI compute, Crusoe sold mining assets to focus resources and simplify its business.

From “Crusoe CEO Chase Lochmiller: Turning Stranded Energy Into Intelligence”, Oct 29, 2026. [Watch the full episode](https://realalpha.app/v/64vUl9k-IAQ/)

## Transcript

Transcribed by machine (Whisper) from the episode’s audio, so a word may be off here and there.

[24:10](https://realalpha.app/v/64vUl9k-IAQ/?t=1450) well so the thing was is that i think externally a lot of people thought this was a pivot for us but internally. And if you talk to any of our investors or any of our employees that have been here for a very long time, they'll tell you that like, this was sort of the plan all along was this energy first approach to computing. You know, I had been doing research in AI, like as a, as a quant portfolio manager. And then, you know, I was at, as at Stanford for grad school and I'm working in AI and doing a lot of work in computer vision and natural language processing. And I was like pretty AI pilled like early.

[24:44](https://realalpha.app/v/64vUl9k-IAQ/?t=1484) early days. Like, you know, when, uh, you know, I was reading things like, like, like one of the more influential things on me was actually Tim Urban had this blog called wait, but why? And he wrote this. Yeah, it's great. It's fantastic. Um, just like everybody should go out and read that, you know, but there were a couple of pieces that were particularly influential on me. Um, there was one that was like about the path to super intelligence and in it, you know, he sort of like espouse this thesis that like, you know, these multilayer neural networks were essentially like really good nonlinear modeling, you know, mechanisms that as they had more data and more compute, they just got better and better at modeling, you know, whatever, whatever thing that you're trying to model, whether it's, you know, natural language or, you know, computer

[25:33](https://realalpha.app/v/64vUl9k-IAQ/?t=1533) vision or, you know, whatever it was. And so I was sort of playing that out and felt like, you know, AI was this meta-science that wasn't going to improve one thing. It was going to improve everything, right? So I had this professor at Stanford named Andrew Ng, and he has this famous saying where he says, AI is like electricity, right? Electricity is not good for one thing, right? If you ask someone, what is electricity good for?

[25:57](https://realalpha.app/v/64vUl9k-IAQ/?t=1557) It's not like, oh, electricity is good to turn on the lights. It's like, yes, it's good at turning on the lights, and it's also good at powering my computer and my car and, uh, heating my stove and, you know, all these different things that we really take for granted with electricity. And so it's not just like one thing that, you know, uh, that, that, that AI is good for it's, it's really good for everything. And, and, you know, I was, I had like high conviction of this fairly early days. And, you know, I felt like if data and compute were the bottlenecks, ultimately compute becomes an energy problem. And when And you sort of play that out and think about that at scale. And we'd sort of seen this unfolding actually with Bitcoin mining. And so the original thesis for the business was like, go find stranded

[26:42](https://realalpha.app/v/64vUl9k-IAQ/?t=1602) energy that is otherwise being underutilized and bring a market to that stranded energy with compute instead of trying to bring that stranded energy to a market where it can be bought and sold, bring the market to the energy. And, you know, that's what led us to, you know, Our initial stranded energy resource was natural gas that was being flared in the oil field where oil companies were drilling for oil.

[27:09](https://realalpha.app/v/64vUl9k-IAQ/?t=1629) They produced natural gas as a byproduct. And then absent having a pipeline, they just light it on. fire. And it was this huge environmental liability. It was a waste product. They were paying money to dispose of it. It's a disaster. And, you know, it's still happening at scale today. But, you know, our solution to that was we would bring these small modular generators and these small modular data centers. And we would we would basically utilize that gas on site and use it to power compute infrastructure, which, you know, our first monetization engine of that was was Bitcoin mining. It was the easiest way to take energy and turn it into money. And we sort of created this great flywheel effect with the Bitcoin business. And there were definitely criticisms early days when I was like, hey, I'm trying to do this AI cloud platform. And people were like,

[27:56](https://realalpha.app/v/64vUl9k-IAQ/?t=1676) what are you talking about? Why are you spending any resources on that? You have this great thing. You're making all this money in Bitcoin. What are you talking about? Why would you focus on anything else. And we tried a ton of stuff and we failed and we screwed a bunch of stuff up in terms of like building out our first AI clusters. And we're trying to figure out what the product looked like and who we were going to serve. And I called a bunch of my friends that were researchers at universities and saying, hey, do you have a use for these GPUs that I'm powering from this gas in the middle of the Bakken oil field in North Dakota? And there were just like many different iterations of trying to get that business to life. But the magic moment was really the launch of ChatGPT. So November 30th, 2022, I think that was just the moment that changed

[28:45](https://realalpha.app/v/64vUl9k-IAQ/?t=1725) everything. And it led to all these new startups that were demanding the exact type of compute infrastructure that we had been building and the exact type of solutions that we had been building from a, you know, a storage, compute, networking, et cetera. Now I had always felt that like Bitcoin and AI, and I still feel this way that they actually go together very well because AI data centers do not consume energy in the same way that Bitcoin mining does. Bitcoin mining is very like, you can, you can almost give it like a fixed draw amount of power and say like, stay at that power level and just like consume that. And it will be like very flat line. And, uh, and then you can move that up and down depending on demand response and what, what available energy is. AI has a bit more variance in terms of, you know, it's overall power utilization. And, you know, you see this in,

[29:38](https://realalpha.app/v/64vUl9k-IAQ/?t=1778) you know, certain, certainly when you're training big workloads for inference and training, but you also have seasonality with. cooling. You tend to have higher PUE during the day when you're having to run your air conditioning units and your chillers more aggressively because it's hotter than at night when you have more natural cooling. Depending on workloads that are being run on the clusters, things can ebb and flow a bit. Okay. But I'm going to come back to you. You were thinking it was an AI company all along. You made a decision to sell off what was a good business. Why didn't you just keep it?

[30:17](https://realalpha.app/v/64vUl9k-IAQ/?t=1817) When did you broach that with the team? When did that become a good idea in your head? Did you get pushback on it? Part of it was we had a great partner that we felt like this business we built would land in a really good home, which was NYDIG. And, you know, I really, Ross Stevens has become a good friend, you know, over the years. And I and Tejas Shaw, who's the CEO there, you know, just deep amount of respect for that team. And we felt like they were great people that would, you know, be great stewards of this business. And they had a lot of experience within natural gas in terms of, you know, Stone Ridge has built out one of the largest natural gas businesses in the United States. And so this intersection of people that knew and had operated natural gas assets at scale and were deeply involved in the Bitcoin ecosystem. We felt like they were, they were

[31:06](https://realalpha.app/v/64vUl9k-IAQ/?t=1866) great partners for that business. But really, I think what drove me to divest that business was really focus. And, you know, we, we are doing a lot at Crusoe and increasingly we were doing more And it felt like we were having to balance this tension between do we allocate capital and resources and attention towards our Bitcoin business or against this AI infrastructure business. And we were also getting feedback from investors where, you know, it would make the story too complex in the eye of an investor where they would say, okay, I love what you're doing over here on this AI business, but my firm were actually blocked from making any investments that are tied to crypto.

[31:56](https://realalpha.app/v/64vUl9k-IAQ/?t=1916) So there were challenges to just making the business focused and making it, you know, this category defining company across vertically integrated AI infrastructure and not having the distraction of being anything related to Bitcoin. And so, you know, I am still.