Bernstein Distinguishes Between AI Deals Made by Bitcoin Miners

Analysts at Bernstein have weighed in on the AI deals made by Bitcoin miners, stating that while some contracts look cheap compared to data center REITs, not all are created equal.

The report highlights Core Scientific's (CORZ) deal with CoreWeave (CRWV), which boasts a 75% return on assets over five years and a 79% yield on cost. However, Bernstein notes that this exceptional performance is due to an unusually capital-expenditure-light structure rather than superior contract economics.

According to the analysts, Core Scientific's edge was not due to better contract terms, but rather the fact that it funded only $105 million of the $855 million cost to build out 590 megawatts, leaving CoreWeave to finance $750 million through revenue prepayments. This represents a fraction of what peers typically spend to build the same capacity.

Other miners such as TeraWulf (WULF) and Cipher (CIFR) offer a more realistic picture of long-term returns for Bitcoin miners entering the AI infrastructure space, with stabilized returns of 5% and 4% on assets respectively. CleanSpark is trading nearly in line with Cipher.