Bitcoin Miners Expand Power Capacity for AI Workloads Amid Shrinking Margins

Public Bitcoin miners are planning to add approximately 30 gigawatts of new power capacity, primarily aimed at artificial intelligence workloads, which is nearly three times the 11 gigawatts they currently have online. According to Cointelegraph, this expansion is part of a strategic move to counteract diminishing mining margins and prepare for the next growth cycle. TheEnergyMag compiled data from 14 publicly traded Bitcoin miners, highlighting the industry's aggressive shift away from traditional hashpower due to persistently weak hashprice conditions. The planned expansion, described by TheEnergyMag as equivalent to a small country's power infrastructure, is largely in development pipelines, interconnection queues, or early-stage plans rather than operational facilities. This widening gap indicates a shift in competition from ASIC efficiency to securing power, financing, and timely delivery of data centers. TheEnergyMag referred to this as "the megawatt arms race of the AI boom," emphasizing that monetization depends on sustained AI demand to justify the scale of investment. The transition towards artificial intelligence infrastructure signifies a hybrid strategy among established Bitcoin miners, with some companies already experiencing significant revenue contributions from AI and high-performance computing (HPC) workloads. HIVE Digital, for instance, recently reported record quarterly revenue, driven partly by its AI and HPC business lines. The company achieved fourth-quarter sales of $93.1 million, marking a 219% increase year on year, despite declining Bitcoin prices during the period. Investors are also recognizing this shift. Earlier this week, Starboard Value publicly suggested that Riot Platforms management accelerate the miner’s expansion into HPC and AI data centers. This push for diversification comes as mining profits have been impacted since the 2024 Bitcoin halving, which reduced block rewards and squeezed margins across the industry. Conditions worsened in the fourth quarter when heavy selling pressure caused Bitcoin to plummet from its record high above $126,000, eventually stabilizing in February after briefly falling below $60,000. Despite these challenges, U.S.-based miners demonstrated resilience at the beginning of the year, with production rebounding after a severe winter storm temporarily disrupted operations.