Core Insights - Morgan Stanley identifies Bitcoin mining companies as having approximately 6.3 GW of operational large sites and an additional 2.5 GW of capacity under construction, making them the "fastest way to obtain power with the lowest execution risk" for AI companies [1][2][6] - The report highlights a significant power shortage for data centers in the U.S., estimating a gap of up to 45 GW from 2025 to 2028, despite various innovative solutions being considered [2][3] - The potential equity value created by converting mining sites into data centers is estimated to be between $5 to $8 per watt, significantly higher than the current trading levels of many Bitcoin mining companies [2][10] Power Shortage Analysis - The demand for power from data centers is projected to reach 65 GW from 2025 to 2028, while the grid can only provide 15 GW of immediate capacity, leading to a substantial shortfall [3][4] - Even with the inclusion of various innovative power solutions, a shortfall of 5 to 15 GW is expected to persist by 2028 [3] Unique Value of Bitcoin Mining Sites - Bitcoin mining sites possess critical assets valued by AI companies, including approved grid connections and large-scale power supply capabilities, allowing them to bypass lengthy approval processes for new data centers [6][9] - The existing infrastructure of Bitcoin mining companies aligns well with the construction timelines required for data centers, which typically take about 18-24 months [6] Market Valuation Insights - The "enterprise value per watt" (EV/Watt) metric is emphasized as a key indicator of value that the market has overlooked, with many Bitcoin mining companies still undervalued [7] - A model analysis indicates that converting a 100 MW Bitcoin mining site into a data center could generate significant equity value, with estimates of $5.19 per watt for large cloud service providers and $7.81 per watt for emerging cloud service providers [10]

Group 1 - The core point of the article highlights the unprecedented demand for electricity driven by the explosive growth of artificial intelligence (AI), with a significant power shortfall projected in the U.S. data center sector from 2025 to 2028 [1][2] - Morgan Stanley's report estimates that the electricity demand for U.S. data centers will reach 65 gigawatts (GW) by 2028, while the grid can only provide 15 GW of immediate capacity, resulting in a shortfall of approximately 45 GW [2][5] - Even with innovative solutions like natural gas turbines and fuel cells, the projected shortfall remains between 5 to 15 GW by 2028, indicating a critical power bottleneck for data center developers [2][4] Group 2 - Bitcoin mining companies possess significant advantages in this context, as they have existing large-scale power supply capabilities and approved grid connections, making them a viable option for AI companies seeking immediate power access [1][4] - U.S. Bitcoin mining firms currently operate approximately 6.3 GW of large-scale sites, with an additional 2.5 GW under construction and 8.6 GW in development with grid access permits [5][8] - The potential economic value of converting Bitcoin mining sites into AI data centers is substantial, with estimates suggesting that such conversions could create equity values ranging from $5.19 to $7.81 per watt, significantly higher than current trading levels of many mining companies [8]