Bitcoin Miners Pivot to AI Data Centers for Higher Returns
Bitcoin miners are shifting their focus to artificial intelligence data centers due to declining profitability in cryptocurrency mining. This strategic pivot is driven by the potential for higher returns, with AI compute reportedly earning 25 times more per kilowatt-hour than bitcoin mining.
Several mining companies are repurposing their energy-intensive facilities for AI and high-performance computing. Cipher Mining, for instance, has a 10-year HPC hosting deal with AI cloud platform Fluidstack, expected to generate $3B in revenue. Similarly, HIVE Digital Technologies bought a 7.2 megawatt data center in Toronto for CAD$17.3M (US$12.4M) to support AI workloads.
IREN, a leading provider of cloud services, has signed multi-year contracts with AI companies. By the end of Q1 2026, these contracts are expected to bring in over $500M in annualized run-rate revenue, powered by 23,000 GPUs. Miners are increasingly using graphics processing units (GPUs) from companies like Nvidia to replace or supplement their mining rigs. The conversion of mining facilities to support AI can happen faster than building from scratch, giving miners a structural advantage in this new market.
The shift towards AI data centers is gaining momentum, with Bitfarms and Riot Platforms also joining the fray. While the profitability timeline for these investments remains uncertain, the potential for higher returns is enticing. As the AI landscape evolves, these former bitcoin miners are positioning themselves to capitalize on the growing demand for AI computing power.
