I am observing a very interesting shift in the Bitcoin mining market lately. Miners are facing a tough decision: continue with traditional mining or transform their infrastructure into hosting services for AI companies.

The context is clear. The demand for computational capacity for AI has become one of the largest sources of electricity consumption in the US recently. Meanwhile, Bitcoin miners are dealing with volatile prices and network difficulty at record levels. When you have 1 gigawatt of available capacity, the choice between mining or renting becomes increasingly strategic.

Several players have already made this transition. Core Scientific converted much of its operation into AI hosting through a partnership with CoreWeave. Iris Energy and Hut 8 significantly increased their revenues with AI and high-performance computing. Companies like Riot Platforms, MARA Holdings, and Genius Group recently announced sales of over 19,000 bitcoins, signaling that relying solely on mining economics has become unsustainable given current prices and challenges.

The logic behind this is simple. When you rent out your hashpower to AI companies, revenue follows pre-established contracts with predictable cash flow. When you mine pure Bitcoin, revenue fluctuates with the coin’s price and network difficulty. With Bitcoin at $69,000, difficulty at all-time highs, and energy costs rising while all industrial users compete for the same electricity, renting out hash capacity often yields higher returns.

But this doesn’t mean Bitcoin mining will disappear. The network continues setting records above 1 zettahash/sec. What is changing is the business model. Miners who survive this cycle will likely no longer be energy companies producing Bitcoin. They will be specialized infrastructures with cheap electricity at scale, mining Bitcoin as a secondary activity while renting out their real asset — energy — to the AI industry, which can’t build data centers fast enough. It’s an interesting transformation in the sector.