Bitcoin's First-Ever Hashrate Bear Market Sparks AI Mining Boom

Twenty One Capital CEO Raphael Zagury has declared that Bitcoin is experiencing its first-ever 'hashrate bear market.' This phenomenon occurs when the network's computing power remains below its previous record, which in this case is the late 2025 peak. According to data, the hashrate fell approximately 22% to 24% from its peak.

Zagury attributed this decline to the increasing popularity of artificial intelligence (AI) among miners. He noted that AI facilities require similar resources as Bitcoin mines, such as large power connections, cooling systems, and access to capital. However, converting a mining site into an AI facility is more complicated than replacing ASIC machines with graphics processors.

As a result, many public miners are redirecting their infrastructure investment towards AI, rather than expanding their Bitcoin fleets. In fact, Zagury stated that 'pretty much everybody' is leaving the industry, although some companies like MARA and CleanSpark continue to operate large Bitcoin mining fleets.