Hyperscale Data plans to form a new subsidiary, Patriot BTC, to hold its Bitcoin mining operations as it develops its Michigan data center for AI workloads.

Under the proposal announced on September 22, the company would transfer its Montana data center, Bitcoin miners, mining equipment, and associated infrastructure to the subsidiary.

“Bitcoin mining and AI data center development have different capital requirements, operating priorities and value drivers,” explained Milton 'Todd' Ault III, Hyperscale Data’s executive chairman.

The firm is evaluating ways to position Patriot BTC within a publicly traded entity, potentially through a separation or another transaction. At the time of the announcement, the subsidiary had not been formed and no transaction structure or separation had been approved. Any transaction would require board approval and compliance with applicable legal and regulatory requirements.

The proposed restructuring follows Hyperscale Data’s shutdown of Bitcoin mining at its Dowagiac, Michigan, facility on September 1, as it prepares the site for a California-based neocloud customer.

Its Alliance Cloud Services subsidiary announced a master services agreement with the customer in June, covering an initial 20MW of critical AI compute capacity. The agreement has a ten-year term and two five-year extension options. Hyperscale Data expects revenue above $1.2bn if both term extensions are exercised.

According to the company’s SEC filing, the customer also has a right of first offer for an additional 32MW of critical AI compute capacity, subject to availability.

In a September 17 update, Hyperscale Data said it was targeting the start of operations under the agreement in November 2026 and had invested more than $70m in Alliance Cloud Services and the Michigan facility.

The company reiterated on October 5 that the campus could ultimately support more than 300MW of total power capacity. Expansion beyond the initial 20MW remains subject to financing, utility agreements, engineering, regulatory approvals and other conditions.