Bitcoin Miners Left Behind in Crypto Rally
Bitcoin miners have seen disappointing returns during the recent crypto rally, while exchanges and stablecoins have surged alongside the cryptocurrency's price. Since August 17, Bitcoin's (BTC) value has risen approximately 22%, but bitcoin mining companies have not shared in this growth. Among tracked companies, only Canaan (CAN), a manufacturer of bitcoin mining rigs, has outperformed BTC, with the remaining 10 miners and mining-adjacent companies underperforming.
The median return for these 10 companies was just 1.8% since the start of the bull market. Some of the worst offenders include Core Scientific (CORZ) and Terawulf (WULF), which have underperformed bitcoin by 27% and 24%, respectively. Several bitcoin miners have pivoted to high-performance computing (HPC) components and infrastructure for AI data centers, which has split their attention.
This pivot was intended to support the stock price during the crypto bear market, but it has created operational risks that are dragging on miner price action. Companies with both mining and AI-related businesses can benefit from both sides of the market: lucrative mining profits during bull markets and balance sheet support from data center build-outs during drawdowns.