- Bitcoin miners are becoming crucial partners in AI data center development.
- Bernstein’s report highlights recent industry moves, like Core Scientific’s agreement with CoreWeave and Hut 8’s funding from Coatue Management.
- Iris Energy and Core Scientific receive favorable coverage with price targets of $26 and $17 respectively.
- Miners currently control 6 GW of power, projected to expand to 12 GW by 2027.
- Their priority in the power interconnect queue streamlines energy procurement for partners.
- Bitcoin data centers are well-suited for retrofitting due to high power density and robust infrastructure.
- Analysts foresee 20% of bitcoin miners’ capacity shifting to AI by 2027.
- Top U.S. miners could consolidate 25% of global bitcoin hashrate, offering future AI scalability.
Main AI News:
Bitcoin miners are emerging as key partners in the construction of artificial intelligence (AI) data centers, leveraging their substantial power supplies and operational expertise, according to brokerage firm Bernstein’s latest research report. Recent industry moves, such as Core Scientific’s long-term agreement with CoreWeave and Hut 8’s $150 million funding from Coatue Management, are seen as pivotal developments driving this trend.
Bernstein initiated coverage on Iris Energy with an outperform rating and a $26 price target, alongside Core Scientific, which received an outperform rating and a $17 objective. As of early Tuesday trading, Iris Energy was priced at $13.40, while Core Scientific stood at $9.79.
The report underscores bitcoin miners’ significant power capacity, currently controlling approximately 6 gigawatts (GW) with plans to expand to 12 GW by 2027. Their strategic position in the power interconnect queue enables them to expedite energy procurement for potential partners, offering substantial time savings.
Analyzing the suitability of bitcoin data centers for retrofitting, the report highlights their high power density racks, robust cooling infrastructure, and advanced operational capabilities. Analysts, led by Gautam Chhugani, project that 20% of bitcoin miners’ power capacity will shift towards AI applications by the end of 2027.
Looking ahead, Bernstein predicts that the top five U.S. bitcoin miners will continue consolidating their scale, potentially commanding up to 25% of the global bitcoin hashrate. This positioning provides them with medium-term flexibility to pivot towards AI, leveraging hashrate as a metric for industry competition and mining complexity.
Maintaining a bullish stance on bitcoin, Bernstein forecasts the cryptocurrency to reach $200,000 by 2025, $500,000 by 2029, and surpass $1 million by 2033. The successful launch of spot bitcoin exchange-traded funds (ETFs) in the U.S. in January has further bolstered the firm’s confidence in these projections.
Conclusion:
Bitcoin miners are poised to significantly influence AI data center growth with their extensive power resources and operational efficiencies. This strategic alignment not only enhances their role in the cryptocurrency ecosystem but also positions them as key players in the evolving AI infrastructure landscape, potentially reshaping market dynamics in both sectors.
