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Bubbles rise from servers insider a tank of cooling liquid in the Microsoft lab. Microsoft is seeking better ways to manage powerful new AI hardware in its cloud computing operation, and focusing on immersion cooling technology used in bitcoin mining as the most promising technology for future high-density data centers. The company is test-driving a setup in which servers are dunked in tanks of cooling fluid to manage rising heat densities. Microsoft showed off a cooling lab where it is cooling servers inside a two-phase immersion system from Allied Control, which is owned by bitcoin mining specialist Bitfury, which uses the design to support power densities of up to kW per rack. With liquid cooling, we can have higher density racks that could lead to smaller data center footprint, and lower their center energy consumption from the mechanical cooling perspective, and also from the server perspective, because we could reduce or remove the fans from the servers. The liquid cooling research is one of many ways that Microsoft is testing new technologies that could radically change data centers. These moonshots and science experiments are in various phases of deployment, but make it clear that Microsoft is preparing to build a very different kind of future cloud as it seeks to meet aggressive carbon reduction goals. Thus far, these initiatives have yet to be deployed at scale.