Bitcoin Miners Flock to AI as Hashprice Hits Bottom
Bitcoin miners are rapidly pivoting to artificial intelligence infrastructure as they anticipate generating roughly 70% of their revenue from AI by December, up from about 30% today. This shift comes after 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.
The mining sector has secured over $70 billion in cumulative AI and high-performance computing contracts, with companies like Core Scientific expanding their CoreWeave deal to $10.2 billion over 12 years. This marks a significant transition for large US miners, who are abandoning their traditional mining roots.
James Butterfill of CoinShares noted that AI offers structurally higher and more stable returns than mining, with cloud margins near 85%. Matthew Kimmell, investment strategist at CoinShares, added that the transition could mark the end of an era for large US miners, citing thin margins and hashprice hitting bottoms.
MARA Holdings sold over $1 billion in Bitcoin to fund its transition, abandoning its long-held HODL strategy. The shift follows a 50% decline in Bitcoin's price from its October peak near $126,000, with the token trading around $76,610 on April 19.