Bitcoin Miners Can Earn $38 Billion Revenue by Embracing AI and HPC, VanEck Predicts
Asset management firm VanEck has forecasted that Bitcoin miners have the potential to unlock up to $38 billion in revenue by transitioning 20% of their operations to artificial intelligence (AI) and high-performance computing (HPC). This shift would allow miners to leverage advanced hardware and cooling systems to cater to the increasing demands of AI data centers.
The Benefits of Integrating AI for Bitcoin Miners
With extensive data centers and substantial power resources in the United States, Bitcoin mining companies are well-equipped to handle computationally intensive AI tasks. The existing infrastructure within these facilities makes them an ideal fit for companies operating in the AI sector.
Van Eck’s projections suggest that if miners allocate 20% of their energy capacity to AI and HPC by 2027, they could generate an average annual revenue of $13.9 billion over the course of 13 years. This figure starkly contrasts with the group’s net profit of $335 million recorded last year.
“After factoring in a 17% discount rate, the net present value of this opportunity is estimated to be $37.6 billion, while the current market capitalization of the 12 companies considered stands at approximately $19.7 billion as of August 12, 2024,” VanEck stated.
Financial Implications for Bitcoin Miners
By venturing into the realm of artificial intelligence and high-performance computing, Bitcoin miners have the potential to enhance their financial standing. Many miners have struggled with poor balance sheets due to issues such as excessive debt, stock issuance, or executive compensation. Engaging in AI and HPC endeavors could offer a path to financial improvement.
Moreover, restructuring efforts during the bear market have positioned many miners to attract funding from AI/HPC clients for capital expenditures. This support could lead to reduced capital costs and better energy deal negotiations.
Growth Prospects and Stock Performance
VanEck believes that investing in AI and HPC could potentially double the value of mining stocks. Initial data indicates that miners focusing on HPC, such as Core Scientific and Terrawolf, have outperformed those without an AI/HPC strategy like Marathon Digital and Rights Platform. Core Scientific and Terrawolf, in particular, have seen superior performance this year due to their emphasis on AI/HPC revenue streams.
“As the synergies between Bitcoin mining, AI/HPC, and the power grid continue to mature in an energy-rich and technologically advanced regulatory environment, even without assuming growth in Bitcoin returns, the Market Vector Digital Asset Stock Index will continue to expand. We anticipate these miners’ market cap to potentially double by 2028,” VanEck projected.
