Bitcoin Miners Bet Big on AI, but May Regret It Within a Year

Bitcoin miners are investing heavily in artificial intelligence (AI) as the cryptocurrency's price and mining profitability have declined. According to data from CryptoSlate, Bitcoin is currently trading around $64,000, nearly 50% below its October peak.

The decline in Bitcoin's price has reduced miner revenue, with daily earnings averaging roughly $28.5 million over a 30-day period, down nearly 40% year-over-year, as reported by VanEck.

Miners are redirecting their power and resources to AI infrastructure, which can provide higher returns due to reliable electricity and long-term capacity. Companies like Core Scientific have already started converting facilities, signing multi-year computing contracts, and pulling back from investing in new Bitcoin mining equipment.

However, André Dragosch, head of research at Bitwise Europe, warns that miners may be making the shift at the wrong time. He believes expectations for AI compute demand could take longer to materialize than current investment implies, and that Bitcoin is approaching the end of its downturn.