Bitcoin miners are pivoting to AI and HPC sectors due to declining Bitcoin yields, with significant contracts already signed.
Bitcoin miners are increasingly repurposing their operations to serve the AI and high-performance computing (HPC) sectors, as reported by Cointelegraph. This shift comes in response to declining yields from Bitcoin mining and the growing demand for AI infrastructure.
Stanford University's projections indicate that the global capacity of AI data centers could reach 29.6 GW by the end of 2025, a significant increase from less than 1 GW in 2022. The surge in AI demand is expected to push electricity needs for AI operations to 9.4 GW by 2024, with some intensive processes potentially consuming over 100 MW. The cost of GPU computing has plummeted by over 99% since 2006, making AI more accessible.
Energy Supply Becomes Key Asset
Specialized Bitcoin mining hardware is not suitable for AI workloads, as AI operations require specific energy setups and infrastructure. Miners are therefore establishing facilities in regions with low electricity costs, such as Texas and the Gulf Coast, to meet these requirements.
Several miners have recently secured substantial contracts in the AI and HPC markets, including:
- IREN's five-year, $9.7 billion deal with Microsoft for cloud GPU services at a 750 MW facility in Texas;
- Hut 8's 15-year, $7 billion agreement with Fluidstack for a 245 MW facility in Louisiana, backed by Google;
- TeraWulf's projected $12.8 billion in revenue from HPC, which is now surpassing its mining earnings;
- Core Scientific's expanded $10.2 billion deal with CoreWeave spanning 12 years.
Impact on Crypto Company Valuations
According to CoinShares, public miners have collectively announced AI and HPC contracts exceeding $70 billion. Companies engaging in these sectors are valued at a revenue multiple of 12.3, compared to 5.9 for those focused solely on Bitcoin mining. Analysts foresee that by the end of 2026, AI could account for about 70% of public miners' revenue, up from approximately 30% in early 2026.
However, the economics of Bitcoin mining have worsened, with the average cost to mine a coin reaching $78,000, while Bitcoin prices hover around $60,000. This has led to over 20% of miners operating at a loss. The transition to AI is also costly, with infrastructure expenses for AI facilities potentially ranging from $8 million to $15 million per MW, compared to $700,000 to $1 million for traditional mining setups.
Additionally, risks such as increasing debt, project delays, and reliance on a small number of major clients have been flagged. For instance, Hut 8's River Bend facility is not expected to launch until the second quarter of 2027, while IREN disclosed $3.75 billion in convertible debt as of March 2026, raising further funds in May. Notably, in May, major public miners sold over 32,000 BTC, surpassing their total sales for all of 2025.
