AI boom shifts Bitcoin miner revenue, but sales continue

MARA Holdings (NASDAQ:MARA), for example, recently sold 13,597 Bitcoin after September 30, as detailed in its shareholder letter. Bitcoin is currently trading at $73,227, down 12% over the past month.

CoinShares tracks the growing trend of miners renting out their data centers to AI and High-Performance Computing (HPC) clients, which perform large-scale computing tasks like training AI models. While stable lease payments from these clients could theoretically reduce the need to sell newly mined Bitcoin, the current situation sees AI fueling further sales.

HIVE Digital Technologies (NASDAQ:HIVE) exemplifies this rapid change, with its HPC revenue surging 70.7% to $8.8 million in the last fiscal quarter. The company’s revenue split is currently 10% AI and 90% Bitcoin mining, with a projected shift to 40% AI and 60% mining.

Several miner filings reveal that Bitcoin sales are being used to finance the expansion into AI infrastructure. Bitdeer Technologies (NASDAQ:BTDR) mined 3,855 Bitcoin in the third quarter, a significant increase from the previous year, yet held only 47 Bitcoin at the end of September, a stark contrast to the 2,029 it held a year prior. The company reported a net loss of $125.5 million on $320.7 million in revenue while building an AI Cloud backlog valued at approximately $2.9 billion.

Similarly, Hyperscale Data (AMEX:GPUS) sold its remaining 212 Bitcoin for roughly $16 million to pay down debt and fund a new AI data center in Michigan. MARA also sold Bitcoin to cover $750 million in Bitcoin-backed loans. Traditional on-chain tracking methods may not fully capture these sales, as many transactions occur off-chain.

While some miners, like MARA, which held 34,012 Bitcoin before the recent sales, maintain Bitcoin as a strategic asset, the need for immediate capital to build AI data centers continues to drive sales. CleanSpark (NASDAQ:CLSK) has financed its data center build through bond debt and has sold almost no Bitcoin recently, although updates on its Bitcoin holdings are now quarterly.

The economics of Bitcoin mining could improve soon, with an anticipated 7.1% decrease in mining difficulty. This would allow remaining miners to earn more coins per machine while Bitcoin’s production cost is estimated at $78,000.

For now, Bitcoin miners are likely to continue selling their Bitcoin, as the upfront costs of building AI infrastructure necessitate immediate funding. A shift in this trend would require either a rise in Bitcoin holdings reported in future filings or a rebound in Bitcoin’s price above its 50-day average of $81,641.