CoinShares: Bitcoin mining companies are nearing break-even and accelerating their shift towards AI businesses.

A CoinShares report indicates that Bitcoin mining companies will face significant profitability pressure in late 2025 and early 2026, impacted by a decline in Bitcoin prices, near-historic network hashrate, and a drop in hashrate prices. In the fourth quarter of 2025, the average cost per Bitcoin for listed mining companies rose to approximately $79,995, while hashrate prices fell from approximately $36–38/PH/s/day to $28–30 in the first quarter of 2026, further squeezing industry profit margins. The report notes that this is one of the most challenging phases since the 2024 halving. During this period, Bitcoin prices fell from a high of approximately $125,000 to approximately $86,000, and coupled with intensified hashrate competition, some mining companies have approached or fallen below the break-even point. The industry has shown signs of consolidation, including three consecutive mining difficulty reductions (the first since July 2022) and listed mining companies cumulatively reducing their reserves by more than 15,000 BTC. Companies such as Core Scientific, Bitdeer, Riot, and MARA have all engaged in selling. Against this backdrop, mining companies are accelerating their transformation towards AI and high-performance computing (HPC). CoinShares predicts that by the end of 2026, the revenue share of listed mining companies from AI businesses may increase from the current approximately 30% to 70%, with the industry having already announced over $70 billion in related contracts. Companies such as IREN, TeraWulf, Core Scientific, Cipher, and Hut 8 are accelerating their transformation into data center operators, while companies like MARA remain primarily focused on mining. Meanwhile, the AI ​​transformation has also driven up industry leverage levels. For example, IREN issued approximately $3.7 billion in convertible bonds, TeraWulf's total debt reached $5.7 billion, and Cipher issued $1.7 billion in senior secured bonds, changing the industry's risk structure. Looking ahead, CoinShares believes that mining profitability will be highly dependent on Bitcoin price movements: if BTC rebounds to $100,000, the hashrate price may rise to approximately $37/PH/s/day; if it returns to the high of $126,000, it may rise to approximately $59; conversely, if it remains below $80,000 for an extended period, industry pressure will persist, but the shutdown of some mines may help reduce supply and stabilize revenue. (The Block)