Crypto Miners Pivot to AI, Boosting Revenue 100%

Cryptocurrency mining companies are increasingly pivoting towards AI and high-performance computing (HPC) infrastructure services. This shift is driven by the declining profitability of cryptocurrency mining due to rising energy costs, prompting these companies to explore more lucrative opportunities in the rapidly growing AI sector. The transition is not without its challenges, as companies must navigate the complexities of shifting their operations and infrastructure to support AI computing. This includes investing in advanced hardware and software, as well as developing the expertise needed to provide high-quality AI services. However, the potential rewards are substantial, as the AI computing market is growing rapidly, driven by increasing demand for AI applications across various industries.

Core Scientific was one of the first to make a significant move in this direction. In June 2024, it signed a 12-year, 35 billion dollar GPU infrastructure hosting agreement with AI cloud provider CoreWeave. This deal provided Core Scientific with a long-term revenue source that is nearly independent of Bitcoin prices, sparking a quiet competition within the mining industry. Riot also took similar steps, pausing its 600-megawatt Bitcoin mining expansion in Kosica and beginning to repurpose the site for large-scale data centers and AI companies. The company shifted its focus from expanding computing power to finding AI tenants.

MARA Holdings announced in August that it would acquire a 64% stake in Exaion, a technology subsidiary of French power company EDF, for 168 million dollars in cash. The agreement allows MARA to potentially increase its stake to 75% with an additional 127 million dollars investment. This acquisition aims to expand MARA's presence in the AI infrastructure sector. Another notable example is TeraWulf, which signed two 10-year agreements with Fluidstack to provide high-performance computing clusters to major cloud service providers. TeraWulf will utilize its Lake Mariner data center campus in upstate New York to deliver over 200 megawatts of critical IT load, with a total contract value of 37 billion dollars, potentially rising to 87 billion dollars if two five-year renewal options are exercised. Google has agreed to invest 18 billion dollars to support the project's debt financing, in exchange for warrants to purchase approximately 41 million shares of TeraWulf common stock, equivalent to an 8% stake.

Currently, most miners are still engaged in Bitcoin mining, but this is no longer their sole business. It is just one of many revenue streams, with future possibilities including AI hosting, GPU leasing, energy brokering, and even sovereign-level computing infrastructure. It is too early to judge the success of miners' pivot to AI, as data is still limited. While HPC services have not yet been fully expanded to all miners, the profit margin per megawatt for AI computing is significantly higher than for mining. Iris Energy's AI service revenue grew from negligible amounts to 2.2 million dollars by June 2025. This relatively new business unit had a profit margin of 98%, compared to 75% for mining operations.

These companies are hoping to replicate the success of CoreWeave, which transitioned from a small mining company to a major AI computing provider. In its second-quarter 2025 financial report, CoreWeave reported a 100% year-over-year revenue increase to 1.21 billion dollars, with a valuation of 48 billion dollars. TeraWulf's stock price surged nearly 60% in a single day following Google's investment, reaching a market capitalization of 3.4 billion dollars. Analysts have described these agreements as "transformative," significantly enhancing TeraWulf's position as a leading provider of large-scale AI/HPC infrastructure. However, they caution that project execution and funding still need close monitoring. These agreements have notably increased the visibility of growth and profitability potential.

The strategic shift of mining companies towards AI/HPC infrastructure services is driven by the need for diversified revenue streams. CoreWeave's success, with its valuation soaring to 48 billion dollars and quarterly revenue exceeding 1.21 billion dollars, serves as a compelling example. The market's positive response is evident, with TeraWulf's stock price surging 60% following Google's investment. As traditional miners accelerate their transformation into AI computing service providers, their ability to convert infrastructure advantages into sustainable profitability will be crucial in navigating market cycles.