As the digital world continues to expand, Bitcoin miners are increasingly looking towards artificial intelligence (AI) and high-performance computing (HPC) to boost their revenue potential. This shift could unlock new opportunities, offering an arbitrage scenario within the market.
Traditionally focused on the computational needs of blockchain, Bitcoin miners are now recognising the growing alignment between their infrastructure and the demands of AI and HPC.
Antonio Velardo, a well-known analyst and trader, stated: “This convergence is driven by the growing energy needs of AI companies, which align closely with the capabilities of Bitcoin miners. By repurposing a portion of their infrastructure to support AI/HPC, Bitcoin miners can capitalise on the booming AI market.”
Currently, Bitcoin miners are valued far lower per megawatt (MW) of installed capacity compared to AI-focused data centres, creating a lucrative arbitrage opportunity. The average Bitcoin mining site is valued at around $4.5 million per MW, whereas some AI data centres command valuations exceeding $30 million per MW. By shifting 20% of their capacity to AI/HPC by 2027, Bitcoin miners could tap into an estimated net present value of $37.6 billion.
Velardo used Core Scientific (CORZ) as an example of a Bitcoin miner capitalising on this trend. The company recently secured a 12-year, $3.5 billion contract with AI hyperscaler CoreWeave for 200 MW of infrastructure.
“This deal increased Core Scientific’s market cap by $1.6 billion, positioning it as a leader in the U.S. data centre market,” Velardo said.
“This is only the beginning, with more Bitcoin miners likely to follow suit by using their assets to meet the rising demand for AI/HPC.”
The revenue potential is enormous. Velardo’s analysis suggests that if publicly traded Bitcoin miners allocate 20% of their energy capacity to AI/HPC, they could generate an additional $13.9 billion in annual profits over the next 13 years. This projection assumes an average revenue of $9.11 million per MW, with an estimated capital investment of $7.5 million per MW for infrastructure conversion.
“While the initial costs are high, the long-term benefits of entering the AI/HPC space could be transformative,” Velardo added. “AI/HPC customers often fund a substantial portion of these capital expenditures, reducing the financial burden on Bitcoin miners and lowering their cost of capital. This enhances the appeal of the arbitrage opportunity I’ve identified.”
However, challenges exist. Velardo said: “Not all Bitcoin mining sites are suitable for AI/HPC conversion, particularly those lacking access to essential infrastructure such as high-speed bandwidth and reliable energy sources.”
“For those who can overcome these hurdles, there is potential to see their valuations double or triple in the coming years,” Velardo noted.
Additionally, Velardo emphasised the strong relationship between Bitcoin miners and energy grid operators. Miners already help stabilise grids, and their entry into AI/HPC could further increase their value as flexible, large-scale energy consumers.
“I believe integrating AI/HPC into Bitcoin mining represents a transformative opportunity,” Velardo concluded. “This strategic pivot not only diversifies revenue streams but also places Bitcoin miners at the intersection of two rapidly growing industries.”
