TeraWulf Skyrockets 54.5%—What’s Fueling This AI-Driven Surge?

Summary
• TeraWulf (WULF) surges 54.5% intraday, trading at $8.4344 after opening at $7.20
• Announces $3.7B AI hosting deal with Fluidstack, backed by Google’s $1.8B guarantee and 8% equity stake
• Secures 80-year Cayuga ground lease for 400 MW infrastructure expansion

The stock’s meteoric rise is anchored by two blockbuster announcements: a landmark AI infrastructure agreement and a strategic land lease. With Google’s financial backing and a projected $8.7B in total revenue, TeraWulf’s Lake Mariner and Cayuga projects are redefining its growth trajectory. The day’s $6.75–$8.55 range underscores the market’s aggressive re-rating of the company’s AI and HPC capabilities.

AI Hosting Deal and Google Backing Ignite Investor Frenzy
TeraWulf’s 54.5% surge is directly tied to its $3.7B, 10-year AI hosting agreement with Fluidstack, a premier HPC cloud provider. Google’s $1.8B backstop of Fluidstack’s lease obligations and its 8% equity stake in TeraWulf signal institutional validation of the company’s AI infrastructure potential. The deal anchors ~$3.7B in contracted revenue, with $8.7B possible via lease extensions, while the Cayuga ground lease adds 400 MW of scalable capacity. These announcements position TeraWulf as a critical player in the AI infrastructure race, attracting speculative and institutional capital.

Data Processing Sector Mixed as TeraWulf Defies Trend
The Data Processing & Outsourced Services sector, led by Equinix (EQIX), saw a -1.6% intraday decline, reflecting broader market caution. However, TeraWulf’s AI-focused infrastructure deals distinguish it from peers, which lack comparable high-margin, long-term contracts. While sector players like EQIX face margin pressures from commoditized cloud services, TeraWulf’s 85% expected NOI margins and Google-backed AI projects create a divergent valuation narrative.

Options Playbook: Leveraging Volatility and Gamma for High-Reward Bets
• 200-day MA: $4.84 (well below current price); RSI: 52.76 (neutral); MACD: 0.147 (bullish divergence)
• Bollinger Bands: Price at $8.43, above upper band of $5.495 (suggesting overbought conditions)

TeraWulf’s options chain offers high-leverage, short-dated contracts ideal for capitalizing on its volatility. Two top picks:

WULF20250822C8
• Call Option, Strike: $8, Expiry: 2025-08-22
• IV: 138.49% (elevated, reflecting market uncertainty)
• Delta: 0.6216 (moderate sensitivity to price moves)
• Theta: -0.0586 (rapid time decay, suitable for short-term bets)
• Gamma: 0.2095 (high sensitivity to price acceleration)
• Turnover: $1.59M (liquid)
• Leverage Ratio: 9.28% (moderate)
• Price Change Ratio: +1025% (speculative potential)

WULF20250822C8.5
• Call Option, Strike: $8.5, Expiry: 2025-08-22
• IV: 140.42% (even higher volatility)
• Delta: 0.5133 (balanced sensitivity)
• Theta: -0.0578 (aggressive time decay)
• Gamma: 0.2166 (strong gamma for momentum plays)
• Turnover: $231.5K (sufficient liquidity)
• Leverage Ratio: 12.46% (high)
• Price Change Ratio: +750% (high-reward potential)

Payoff Analysis: Assuming a 5% upside to $8.8561, the WULF20250822C8.5 would yield max(0, 8.8561 - 8.5) = $0.3561 per share. With a leverage ratio of 12.46%, this represents a 28.6% return on the option’s notional value. The WULF20250822C8 would yield $0.8561 per share, a 107% return. These contracts are ideal for aggressive bulls expecting a continuation of the AI-driven rally.

Hook: Aggressive bulls may consider WULF20250822C8.5 into a breakout above $8.50, leveraging its high gamma and IV for exponential gains.

Backtest TeraWulf Stock Performance
The backtest of WULF's performance after a 54% intraday increase shows favorable results, with win rates and returns indicating positive short-to-medium-term gains. The 3-Day win rate is 51.78%, the 10-Day win rate is also 51.78%, and the 30-Day win rate is 55.58%. These rates suggest that WULF tends to maintain momentum after a significant intraday surge. The maximum return during the backtest was 20.84% over 30 days, which implies that there is potential for continued upward movement following a strong initial day.

TeraWulf’s AI Bet: A High-Volatility Play with Clear Catalysts
TeraWulf’s surge is underpinned by concrete revenue-generating AI infrastructure deals and strategic partnerships, making its volatility a feature rather than a bug. While the stock’s 52-week high of $9.30 remains a near-term target, the $8.50 level is critical for maintaining momentum. Investors should monitor the 52-week low of $2.06 as a floor and the 200-day MA ($4.84) for support. With Equinix (EQIX) down 1.6%, TeraWulf’s divergence highlights its unique positioning in the AI infrastructure boom. Aggressive traders should watch the WULF20250822C8.5 for a breakout above $8.50, while long-term holders may consider the 200 MW Lake Mariner deployment in H1 2026 as a key catalyst.