Bitcoin News Today: Bitcoin Miners and AI Firms Clash Over Energy Contracts

Bitcoin mining firms and artificial intelligence data centers are locked in a growing battle for access to low-cost, sustainable energy, a dynamic that could drive renewed institutional interest in the cryptocurrency sector over the next decade. According to a July 31 report from GoMining Institutional, AI data centers—fueled by deep capital reserves—have begun outbidding Bitcoin miners for energy contracts, forcing some miners to scale back operations or reprioritize their strategies [1].

Jeremy Dreier, managing director at GoMining Institutional, highlighted that Bitcoin miners have a distinct advantage over AI companies in this energy race due to their ability to operate in off-grid locations with limited high-speed internet infrastructure [1]. This flexibility allows miners to tap into underutilized energy resources, which Dreier argues will be a key factor in sustaining the mining industry amid rising competition.

The competition is already prompting a strategic shift among some Bitcoin miners. For example, Riot Platforms has halted expansion plans for its Bitcoin mining operation in Texas to explore AI opportunities at the same site, while Iris Energy has imposed a self-imposed cap on mining fleet growth and redirected focus toward its AI cloud business [1]. These moves reflect a broader trend of crypto firms diversifying their revenue streams in response to declining mining profitability.

Institutional investors are also taking note. As more corporations and treasury firms look to acquire "virgin" Bitcoin—newly mined coins—at lower costs than spot prices, demand for mining infrastructure is increasing. GoMining has reported a surge in inquiries from institutions seeking to directly fund Bitcoin production [1]. According to TheMinerMag, the implied production cost of a Bitcoin averaged $64,000 in the first quarter of 2025, with projections suggesting it will exceed $70,000 by year-end—still significantly cheaper than the current market price of over $119,050 [1].

Some firms are doubling down on innovation to reduce costs. Block Inc. recently introduced a new cryptocurrency mining system aimed at extending the lifespan of mining hardware and cutting operational expenses [1]. Others, like TeraWulf, are forging partnerships with major tech firms, such as its $3.7 billion AI infrastructure deal with Google, which includes warrants for additional shares [5]. Such partnerships underscore the broader alignment between tech giants and crypto firms with the necessary computational and energy infrastructure [5].

HIVE is another example of a firm leveraging renewable energy to support both Bitcoin mining and AI operations. This dual approach allows companies to hedge against the volatility of the cryptocurrency market while positioning themselves for growth in the AI sector [6]. The convergence of Bitcoin mining and AI computing is reshaping energy and technology industries, with firms leveraging existing infrastructure to adapt to a rapidly evolving economic landscape [3].

However, the increasing energy demands from AI operations raise concerns about supply and pricing. In regions where demand for electricity outpaces supply, energy costs could rise sharply, further intensifying the competition between miners and AI firms [3]. Analysts suggest that while AI services offer a promising new revenue stream, they remain an emerging and unpredictable source of income for many companies [4].

Sources:

[1]title1: Bitcoin miners and the Hidden War With AI (feat. GoMining) (https://cointelegraph.com/news/bitcoin-miners-ai-energy-battle-institutional-investment)

[3]title3: who will be the next CoreWeave? (https://news.futunn.com/en/post/60672082/cryptocurrency-mining-companies-are-increasingly-transforming-into-ai-computing-power)

[4]title4: Bitcoin Miners Strike Gold in AI: Strategic Shift Sparks (https://www.ainvest.com/news/bitcoin-miners-strike-gold-ai-strategic-shift-sparks-industry-revival-2508/)

[5]title5: Bitcoin Miner TeraWulf Lands Google Partnership in $3.7B AI (https://www.blockhead.co/2025/08/15/bitcoin-miner-terawulf-lands-google-partnership-in-3-7b-ai-infrastructure-deal/)

[6]title6: HIVE's Infrastructure Play: Why Bitcoin Mining Led to an AI (https://www.thewealthadvisor.com/article/hives-infrastructure-play-why-bitcoin-mining-led-ai-goldmine)