Bitcoin Miners Bet Big on AI as Hashprice Hits Rock Bottom
Bitcoin miners are rapidly pivoting to artificial intelligence infrastructure as a significant source of revenue. According to CoinShares, publicly listed Bitcoin miners will generate approximately 70% of their combined revenue from AI by December, up from about 30% today.
The shift follows a brutal quarter for miners, with hashprice, the measure of daily revenue per petahash, falling to around $29, levels last seen after the April 2024 halving. Bitcoin mining gross margins have dropped to roughly 60%, down from above 90% during the 2021 bull run.
More than $70 billion in cumulative AI and high-performance computing contracts have been announced across the public mining sector, with companies like Core Scientific expanding its CoreWeave deal to $10.2 billion over 12 years, TeraWulf having $12.8 billion in contracted HPC revenue, and Hut 8 signing a $7 billion lease.
James Butterfill, CoinShares head of research, stated that AI offers structurally higher and more stable returns than mining, with cloud margins near 85%. Matthew Kimmell, investment strategist at CoinShares, noted that the transition could mark the end of an era for large US miners due to thin margins and hashprice hitting bottoms.