Tether Group, the issuer of stablecoin Tether (CRYPTO: USDT), is buying thousands of Nvidia (NASDAQ:NVDA) H100 GPUs for $420 million.

The deal includes a 20% stake in German-listed bitcoin miner Northern Data, which intends to rent the chips to artificial intelligence (AI) startups.

Tether will acquire 10,000 GPUs through an Irish shell company, Damoon.

Also Read: Tether To Unleash $1B Liquidity Flood On Tron Network For Imminent Issuance Demands

Northern Data, meanwhile, will acquire a 70% ownership stake in exchange for shares equal to 20% of its ownership. The company also has the option to acquire the remaining shell company, however, no deal has yet been finalized and the total cost remains undisclosed.

Northern Data has earlier used shell companies, mostly connected with its shareholders, to purchase Bitcoin mining equipment and GPUs.

Like Northern Data, many other miners (i.e., Hive, Crusoe, and Hut 8) have also rented GPUs to startups who are in dire need of the chips. Because GPUs are basically of no use to Ethereum miners post the September 2022 energy-saving overhaul, this strategy has become a new source of revenue.

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Northern Data CEO Aroosh Thillainathan believes the deal will help the company become the largest cloud GPU operator in Europe, on par with other major cloud computing giants such as Amazon, Microsoft Azure, and Oracle.

H100 is the graphics processing unit used by AI companies looking to process large data sets and is priced at $40,000 per chip. Nvidia is expected to deliver 550,000 in total H100 chips throughout 2023. Thillainathan states that grabbing 2% of the high-demand GPU allocation was rare for the company.

Investment in GPUs and cloud computing is a recent trend followed by many countries. The British government has apparently allocated $120 million for GPUs, while Saudi Arabia has already purchased around 3,000 of Nvidia’s H100 chips.

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