Miners transitioning to AI computing power: CoinShares predicts 70% of revenue will come from AI by the end of the year

In April 2024, Bitcoin completed its fourth halving in history, with block rewards sharply decreasing from 6.25 BTC to 3.125 BTC. At that time, industry expectations generally anticipated that the price increase would buffer the impact of the halving, but the market trend over the following two years did not follow this script.

As of April 21, 2026, data from Gate shows Bitcoin at $75,674.7, down about 40% from the October 2025 peak of approximately $126,080. Meanwhile, the total network hash rate once surged to a record high of around 1,160 EH/s at the end of 2025, significantly diluting mining revenue per unit of hash power. The dual squeeze from costs and income has pushed miners into a structural profitability crisis.

According to a mining report released by CoinShares in March 2026, the weighted average cash cost to produce a single Bitcoin for publicly listed miners in Q4 2025 had risen to about $79,995, while Bitcoin trading prices fluctuated between $70,000 and $75,000 during the same period. This means that even without considering equipment depreciation and capital expenditures, some miners are already operating at a cash loss. The Hashprice, which measures miners’ core profitability, fell to about $28 to $30 per PH/s daily in Q1 2026, hitting the lowest level since the halving.

Faced with an unsustainable business model, publicly listed mining companies have initiated a systematic shift from Bitcoin mining to AI computing infrastructure.

An Industry-Wide Collective Transformation

By the end of March 2026, listed miners had signed over $70 billion in contracts for AI and high-performance computing (HPC). CoinShares’ report predicts that by the end of 2026, some leading miners will derive up to 70% of their revenue from AI operations, compared to about 30% currently. Miners are transitioning from “mainly Bitcoin mining” to a new model focused on operating data centers with mining as a secondary activity.

The core driver behind this transformation is the stark difference in unit economics. Industry analysis shows that AI data centers can generate between $200 and $500 in revenue per megawatt, whereas Bitcoin mining yields only $57 to $129 per megawatt, with the former’s revenue potential up to 8 times higher. In terms of infrastructure costs, Bitcoin mining infrastructure costs about $700,000 to $1 million per megawatt, while AI infrastructure costs roughly $60k to $15 million per megawatt—an investment gap that is significant. However, AI offers a more structurally higher and more stable dollar cash flow that is decoupled from the coin price.

Structural Shift in Capital and Holdings

The funds for this transition mainly come from two sources: leveraged financing and selling Bitcoin reserves.

In Q1 2026, North American listed miners sold over 32,000 BTC, surpassing the total for all of 2025 and exceeding the approximately 20,000 BTC sold during Q2 2022’s Terra-Luna collapse, setting a new quarterly record for miner disposals. On-chain data from CryptoQuant shows that the total Bitcoin holdings of miners decreased from about 1.86 million at the end of 2023 to around 1.80 million, a net reduction of about 60k BTC over two years. From hoarding for a potential rise to actively liquidating, miners’ roles are undergoing a fundamental change.

Meanwhile, many miners are raising funds through debt to support AI infrastructure development. IREN issued $3.7 billion in convertible bonds, Bitdeer’s total debt reached $1.3 billion, and operators like TeraWulf and Cipher have taken on billions of dollars in debt for data center expansion.

Four Miners’ Transition Paths

Different miners are adopting varied strategies based on their resource endowments, but all point toward the same direction.

Core Scientific: The Most Aggressive Pioneer. In January 2026, the company sold about 1,900 BTC, cashing out $175 million, and plans to clear its remaining holdings within the year. Its goal is to convert all 1.3 GW of its Texas mining farm’s power capacity to AI hosting, with Morgan Stanley providing a $500 million credit line, expandable to $1 billion. Core Scientific’s expansion agreement with CoreWeave is valued at $10.2 billion over 12 years. Currently, AI hosting accounts for 39% of its total revenue.

MARA Holdings: A Symbolic Turnaround. Once known for “never selling coins,” this miner changed its treasury policy in March 2026, authorizing the sale of all approximately 53,822 BTC, and had sold over 13,000 BTC in Q1. MARA has also signed a joint venture with Starwood Capital to convert some of its Bitcoin mining farms into AI data centers, initially with about 1 GW capacity, expandable to 2.5 GW.

TeraWulf: A Steady Diversification Leader. TeraWulf has signed $12.8 billion in HPC contracts, with AI revenue accounting for 27%. Its early and relatively cautious transition strategy makes it one of the more highly valued players in the capital markets.

Bitdeer: Clearing Holdings and Accelerating Expansion. Bitdeer has opted to liquidate its Bitcoin holdings to boost liquidity, accelerating its strategy of acquiring power and land. Its self-operated hash rate has risen to 63.2 EH/s, surpassing MARA to become the largest publicly listed miner with self-operated hash power.

Chain Reaction at the Network Level

The large-scale migration of hash power by miners has had a tangible impact on Bitcoin network security.

Total network hash rate dropped from a peak of about 1,160 EH/s in 2025 to around 920 EH/s, losing over 200 EH/s of computational power. On March 20, 2026, Bitcoin experienced its second-largest difficulty adjustment of the year, with nearly an 8% decrease, and hash rate briefly fell below 1 ZH/s. Around April 18, 2026, network difficulty was adjusted downward again by about 4.91%, from 138.97 trillion to 132.14 trillion. Multiple difficulty adjustments in succession are typically clear signals of widespread miner capitulation in Bitcoin’s history.

Charles Edwards, founder of Capriole Investments, expressed concern, citing forecasts that the proportion of Bitcoin revenue for top listed miners could fall to an average of 30% over the next three years. He stated, “Even if these figures are only half accurate, the energy and commitments invested in Bitcoin are under serious threat.”

Market Pricing Divergence

The capital markets have already assigned clear valuations to miners’ transition choices. Miners with HPC contracts are valued at approximately 12.3 times their projected 12-month revenue, while pure-play mining companies are valued at only 5.9 times. The valuation gap of more than double indicates that investors no longer see these companies as “Bitcoin leverage tools,” but rather as “infrastructure operators” based on power assets and data center capabilities.

Emerging Security Risks in Mining: New Threats from AI Computing Infrastructure

The large-scale shift of miners toward AI infrastructure is not merely a business transition but introduces entirely new risk dimensions.

On one hand, hardware security threats are emerging. In late 2025, security researchers discovered a global attack campaign codenamed ShadowRay 2.0, exploiting unpatched authentication vulnerabilities (CVE-2023-48022, CVSS score 9.8) in the open-source AI framework Ray. The attack turned NVIDIA GPU-powered AI clusters into self-replicating crypto-mining botnets. Attackers used Ray’s legitimate orchestration functions as autonomous spreading tools, propagating malicious payloads worldwide. For miners transitioning from Bitcoin ASICs to GPU clusters, their AI infrastructure could become targets—attackers need not crack blockchain encryption but only exploit vulnerabilities in AI frameworks to hijack GPU power.

On the other hand, financial risks during the transition are also significant. Many miners have taken on large debts to fund AI infrastructure, with some experiencing a sharp increase in leverage. If AI demand or contract execution falls short of expectations, financial pressures could rapidly escalate.

Conclusion

The large-scale shift of Bitcoin miners to AI computing infrastructure is not just a passive response to profitability pressures but a structural event involving re-pricing of hash assets, reallocation of capital flows, and reshaping of network security. The 2024 halving exposed the fragility of Bitcoin’s mining economic model, while explosive growth in AI computing demand offers miners an alternative survival path. With $70 billion in contracts, 32,000 BTC sold in a single quarter, and over 200 EH/s of network hash rate lost, these data points collectively point to an accelerating trend: the boundary between mining and AI computing is dissolving, and Bitcoin’s foundational decentralization is undergoing its most profound test since inception.