Miners Ditch Crypto Roots As AI Dominance Grows

Bitcoin miners are rapidly shifting their focus from cryptocurrency mining to artificial intelligence infrastructure. According to CoinShares, publicly listed Bitcoin miners will generate around 70% of their combined revenue from AI and high-performance computing by December, up from approximately 30% today.

This projection 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. Bitcoin mining gross margins have dropped to roughly 60%, down from above 90% during the 2021 bull run.

James Butterfill, CoinShares head of research, noted that AI offers structurally higher and more stable returns than mining, with cloud margins near 85%. Matthew Kimmell, investment strategist at CoinShares, stated that the transition could mark the end of an era for large US miners, citing thin margins and hashprice hitting bottoms.

Several companies have moved aggressively to capitalize on AI opportunities. Core Scientific expanded its CoreWeave deal to $10.2 billion over 12 years, while TeraWulf has $12.8 billion in contracted HPC revenue and Hut 8 signed a $7 billion lease. MARA Holdings sold over $1 billion in Bitcoin to fund the transition, abandoning its long-held HODL strategy.