Bitcoin News Today: Bitcoin Miners and AI Firms Clash in Energy Pricing War

Bitcoin miners and artificial intelligence data centers are locked in a fierce competition for access to the cheapest and most sustainable energy sources, a conflict reshaping the energy landscape and drawing increasing attention from institutional investors. The competition is intensifying as AI firms outbid miners for low-cost power, especially in remote or off-grid locations where energy remains relatively affordable [3]. This shift is not only altering the economics of mining but also increasing electricity costs for households and small businesses, as utilities struggle to expand grid capacity to meet the rising industrial demand [6].

According to GoMining Institutional, this energy battle is expected to drive a new wave of institutional investment in Bitcoin mining over the next decade. Jeremy Dreier, managing director of the firm, predicts that the competition could lead to a resurgence in mining activity, particularly as institutional investors seek to acquire "virgin" Bitcoin at prices below the current market value [3]. In Q1 2025, the average cost to mine one Bitcoin was approximately $64,000, with forecasts suggesting this will rise to around $70,000 by year-end [3]. At current price levels, this cost remains roughly 70% below the market price of over $119,000, making it an attractive option for companies looking to strengthen their balance sheets with newly mined coins [3].

The April 2024 Bitcoin halving reduced the block reward to 3.125 BTC, effectively halving miners' revenues. Despite this, mining remains profitable, and some companies are responding by pivoting toward AI to better leverage their existing infrastructure [3]. For example, Riot Platforms has suspended expansion plans in Texas to reposition on AI, while Iris Energy is limiting rig fleet growth to focus on AI cloud services [3]. Similarly, Hive tripled its AI revenue in 2025 to $10.1 million and aims to reach $100 million by 2026 [3].

Meanwhile, some firms are innovating in hardware to reduce costs and extend rig lifespans. Block Inc. is developing new ASIC mining systems designed to cut expenses, while Hut 8 has fully entered the AI space through its subsidiary Highrise AI, now equipped with over 1,000 Nvidia H100 chips [3]. Iren, a subsidiary of Iris Energy, has significantly expanded its GPU capacity over 18 months and now earns $3.6 million per quarter from AI cloud [3].

Miners still hold certain advantages, particularly in their ability to operate in remote locations where high-speed internet is not a prerequisite. This flexibility allows them to tap into low-cost energy sources independent of traditional grids [3]. However, this edge is being challenged as AI firms, backed by substantial capital and strategic partnerships, continue to outbid miners for power contracts.

The energy competition is also influencing the broader crypto market. As mining costs rise and institutional interest in acquiring Bitcoin at a discount increases, the ecosystem is becoming more structured and capital-driven. This trend could further integrate Bitcoin into traditional finance, as investors seek tangible exposure through mining and ETF investments [1].

With energy demand from both sectors expected to rise, the market is preparing for a period of consolidation and transformation. Both Bitcoin miners and AI firms are under pressure to optimize energy use and reduce their environmental impact, making sustainability a critical factor in long-term viability [3].

Source:

[1] "Bitcoin Miners and AI Firms Clash Over Energy Contracts" (https://www.ainvest.com/news/bitcoin-news-today-bitcoin-miners-ai-firms-clash-energy-contracts-2508/)

[3] "Bitcoin Miners and AI Firms Compete for Cheap Energy" (https://ultramining.com/news/en/bitcoin-miners-and-ai-firms-compete-for-cheap-energy/)

[6] "U.S. AI boom is completely upending the electricity market" (https://www.tomshardware.com/tech-industry/artificial-intelligence/u-s-ai-boom-is-completely-upending-the-electricity-market-small-businesses-and-households-could-foot-the-bill-as-industry-watchers-warn-of-sharp-price-increases)