WGMI Soars as Miners Abandon Bitcoin for AI Leasing Deals

The Valkyrie Bitcoin Miners ETF (NASDAQ:WGMI) has defied the decline in Bitcoin's value, rising 97% over the past year despite a 46% drop in the cryptocurrency. The divergence can be attributed to the fund's shift towards holding bitcoin miners that have pivoted to artificial intelligence (AI) leasing deals.

Riot Platforms, Core Scientific, and IREN have all signed significant AI leasing contracts with major players like AMD and NVIDIA. These deals have decoupled WGMI from its original purpose as a leveraged Bitcoin proxy.

WGMI's holdings now consist mainly of miners that rely on these AI leasing agreements for revenue, rather than solely mining Bitcoin. The fund's actively managed structure means the manager's rebalancing plays a crucial role in determining its performance.

The key signal to track is the weight of AI-pivoted names against pure miners within WGMI's holdings. If the manager shifts towards pure-play laggards, the fund's BTC beta may snap back, and its decoupling from Bitcoin could be reversed.