As the profitability of crypto mining decreases due to falling energy costs, a clear trend has emerged for crypto mining companies to transition towards AI and high-performance computing (HPC) infrastructure services.
The Zhitong Finance APP noted that as the profits from cryptocurrency mining shrink due to declining energy costs, a clear trend has emerged of cryptocurrency mining companies transitioning to AI and high-performance computing (HPC) infrastructure services. Miners are leveraging existing advanced computing capabilities and energy infrastructure to explore new opportunities in the rapidly growing field of artificial intelligence.
The latest report from TheMinerMag indicates that the cost of Bitcoin mining is expected to exceed $70,000 in the second quarter of 2025, reflecting an approximate 9.4% increase from $64,000 in the first quarter. Following the Bitcoin halving, mining revenues are decreasing, prompting mining companies to diversify.
In April 2024, the fourth Bitcoin halving quietly reset the rules of the game for miners. The reward for each block decreased from 6.25 BTC to 3.125 BTC. Maintaining the original model implies covering energy costs and upgrading equipment. The profitability of mining dropped from approximately $0.08 per day (1 TH/s) to $0.055 per day (1 TH/s).
Post-halving, profit margins have become tighter. The cost of mining Bitcoin is higher than ever, and many miners have realized that the old model—mine, sell, and repeat—is no longer viable. Some miners have discovered that they possess the foundation for transformation: facilities built for high-energy-consuming machines. They have begun repurposing their infrastructure for artificial intelligence computing.
Trend of Transformation
Core Scientific has taken the lead with a high-profile move. In June 2024, it signed a 12-year, $3.5 billion GPU infrastructure hosting agreement with AI cloud provider CoreWeave. This is one of the largest AI hosting deals ever made. The contract provides Core with a long-term revenue source that is largely independent of Bitcoin prices, and it has sparked a quiet competition in the mining sector.
Riot has also taken similar measures. In January 2025, Riot suspended its expansion plan for the 600 MW Bitcoin mining facility located in Corsicana and began to resell the facility to hyperscale data centers and artificial intelligence companies. The company has shifted from expanding computing power to seeking AI tenants.
On August 11, MARA Holdings (MARA.US) will acquire 64% of Exaion, a technology subsidiary of Electricité de France (EDF), for $168 million in cash. Under the agreement, MARA also has the option to invest an additional $127 million to increase its stake to 75%. Electricité de France will continue to retain minority shareholder status. This acquisition aims to expand MARA’s business footprint in the artificial intelligence infrastructure sector.
A recent example is TeraWulf (WULF.US) signing two ten-year agreements with Fluidstack to provide high-performance computing clusters for large cloud service providers. According to the agreements, TeraWulf will utilize its Lake Mariner data center campus in western New York to deliver over 200 MW of critical IT load. The total contract revenue is $3.7 billion, and if both five-year renewal options are exercised, the total contract value will increase to $8.7 billion.
Google has agreed to invest $1.8 billion to support the project, which will be used for project-related debt financing. In exchange, Google will receive warrants to purchase approximately 41 million shares of TeraWulf common stock, equivalent to an 8% equity stake.
Currently, most miners are still mining Bitcoin. However, this is no longer their sole business. It is merely one of many revenue sources, which may also include AI hosting, GPU leasing, energy brokerage, and even sovereign-grade computing infrastructure in the future.
It is still too early to determine the success of miners shifting towards artificial intelligence, as the data is insufficient. Although high-performance computing (HPC) business has not yet fully expanded to all miners, the profit margin per MW for AI computing is significantly higher than that of mining. Iris Energy’s revenue from AI services grew from negligible amounts to $2.2 million by June 2025. The profit margin for this relatively new business segment stands at 98%, while the profit margin for mining operations is 75%.
Who will be the next CoreWeave?
These companies hope to emulate the success story of CoreWeave (CRWV.US), which transitioned from a small mining company to a significant provider of artificial intelligence computing. In its Q2 2025 earnings report, CoreWeave’s revenue doubled year-on-year to $1.21 billion, with a valuation reaching $48 billion.
After TeraWulf secured investment from Google, its stock price surged nearly 60% in a single day, reaching a market cap of $3.4 billion. Investment bank Clear Street stated in its latest research report that these agreements are “transformative agreements,” “significantly enhancing its position as a leading provider of hyperscale artificial intelligence/high-performance computing infrastructure.”
The company noted that project execution and funding still require “close monitoring,” but these agreements “significantly enhance the visibility of growth and profitability.”
JPMorgan believes that CleanSpark (CLSK.US), Riot (RIOT.US), and IREN (IREN.US) may potentially engage in HPC client services in the future, listing CleanSpark as a preferred Bitcoin mining company and raising its target price to $15.
Although the bank’s analysts recognize Riot’s potential to expand into the HPC service sector and diversify its revenue beyond cryptocurrency mining, they remain cautious due to uncertainties regarding the transformation timeline.
At the end of July, JPMorgan upgraded MARA (MARA.US) to “overweight,” believing that its computing power targets are not fully reflected in its stock price. While MARA’s adjusted EBITDA for the second quarter increased tenfold to $808 million, it remains heavily reliant on fluctuations in cryptocurrency prices. The company aims to enter the AI computing power market, which is expected to grow at an annual rate of 25%, through Exaion’s HPC data center and cloud service capabilities, thereby reducing the impact of cryptocurrency volatility.
The core driver behind the strategic shift of mining companies towards AI/HPC infrastructure services is the pursuit of diversified profit models—validated by the successful example of CoreWeave, whose valuation skyrocketed to $48 billion post-transformation, with quarterly revenue exceeding $1.2 billion. The response from capital markets has also been positive: after TeraWulf secured investment from Google, its stock price soared 60% in one day. As traditional miners accelerate their transformation into AI computing service providers, the ability to convert their infrastructure advantages into sustainable profitability will become a critical watershed for companies to navigate through cycles.