Bitcoin Mining in Crisis? Major Firms Abandon Crypto for AI and HPC

Core Insights - Bitcoin mining firms are transitioning from cryptocurrency mining to AI data centers due to rising energy costs and reduced halving rewards, marking a significant industry shift [1][2][3] Industry Trends - The April 2024 halving event reduced Bitcoin mining rewards, causing a decline in average hashprice from $0.12 to under $0.05 by mid-2025, prompting miners to seek alternative revenue sources [3] - AI infrastructure requires substantial energy, and existing Bitcoin miners possess the necessary resources, including energy contracts and hardware, to support AI operations [5] Financial Implications - Analysts from VanEck estimate that Bitcoin miners could generate $38 billion in annual revenue by converting their infrastructure for AI and high-performance computing, which is 25 times more profitable per megawatt than traditional mining [6][7] - Public miners have raised over $4.6 billion in debt and convertible securities since late 2024 to finance this transition, increasing execution risks associated with the pivot to AI [8] Company Developments - Core Scientific has committed to AI hosting, utilizing its 1.3 GW capacity and has signed a $10.2 billion contract with CoreWeave for AI compute services [10] - Iris Energy has expanded its AI cloud infrastructure, scaling its GPU units to over 4,300 [11]