Bitcoin Mining Faces Record Costs as Firms Pivot Toward AI Infrastructure

In October 2025, leading Bitcoin mining companies saw a slight uptick in production costs and network difficulty, which reached new all-time highs. At the same time, several of these firms began shifting their strategic focus toward artificial intelligence (AI) infrastructure, signaling a broader transformation across the industry.

Declining Production and Rising BTC Sales

Bitcoin (BTC) output among major public miners dipped slightly compared to September, largely due to higher mining difficulty and intermittent power constraints in parts of North America. Cango Inc. mined around 602.6 BTC during the month, while CleanSpark maintained steady output at 612 BTC. Riot Platforms produced 437 BTC, down marginally from the previous month, and raised its total holdings to 19,324 BTC—suggesting partial Bitcoin sales to sustain liquidity.

BitFuFu’s October output reached 253 BTC, increasing its total reserves to 1,953 BTC. Meanwhile, smaller firms such as DMG Blockchain and LM Funding America maintained stable operations, contributing to Bitcoin’s decentralization despite limited scale.

Larger players like Marathon Digital Holdings (MARA) and Cipher Mining have yet to release October data but posted strong third-quarter results, underscoring their resilience. Marathon reported a record $123 million profit for Q3 2025, while on-chain data indicated a large Bitcoin transfer of 2,348 BTC—likely linked to profit realization after the latest price rally. Cipher Mining recorded $72 million in quarterly revenue and revealed plans to issue $1.4 billion in high-yield bonds to finance a data center project tied to Google.

TeraWulf also reported strong results, projecting Q3 revenue between $48 million and $52 million. The firm raised $3.2 billion through senior secured notes to expand its U.S. infrastructure. Collectively, these moves highlight an accelerating trend: Bitcoin miners are repositioning as digital infrastructure providers bridging blockchain and AI-driven high-performance computing (HPC).

Record Costs and Growing Competition

Data from MacroMicro shows the average cost to mine one Bitcoin climbed to an unprecedented $114,842 in October, while network difficulty increased by 6.31% to 155.97 trillion—both record highs. With Bitcoin trading near $102,000, many smaller miners now face profit compression, forcing the industry toward rapid technological and operational upgrades.

In response, leading companies are investing in next-generation ASICs, renewable energy integration, and hybrid mining models that combine BTC operations with AI computing workloads. The growing overlap between Bitcoin mining and AI data processing is reshaping industry economics, with efficiency and scale now determining long-term survival.

The Rise of Nationalized and Institutional Mining

An emerging trend involves governments and sovereign investment funds entering the mining sector to secure strategic control over energy and data infrastructure. This gradual “nationalization” of Bitcoin mining could alter the global balance of power, as states with surplus energy resources leverage them for cost-efficient mining—reducing reliance on private operators.

Toward a New Era of Hybrid Mining

October 2025 marks a critical turning point for the Bitcoin mining ecosystem. Rising energy costs, record difficulty, and narrowing margins are driving consolidation and innovation across the industry. Analysts expect 2026 to bring one of the largest waves of mergers in mining history, setting the stage for a new hybrid model where Bitcoin mining and AI computation converge into a single digital infrastructure framework.