AI-Focused Bitcoin Miners Outperform

AI-focused Bitcoin miners like Core Scientific, IREN, and Terawulf are outperforming traditional miners due to strong investor confidence in their diversified business models and predictable revenue streams, according to Bernstein analysts.

Key Points:

• Stronger Investor Confidence: AI firms have better valuations and flexibility in the volatile Bitcoin market.
• Infrastructure Expansion: AI miners are growing their data center capabilities alongside their hash rates, tapping into the booming AI sector.
• IREN’s Growth: IREN is noted for its rapid hash rate growth, planning to double its GPU fleet and hash rate by December.
• Diverging Strategies: Large public miners like Marathon and Riot are holding Bitcoin, choosing to retain more mined coins instead of selling, while AI miners sell 100% of their production to fund operations.
• Market Dynamics: Analysts believe pure-play miners will see significant upside post-election, leveraging their substantial power capacities for valuation gains.

Current Bitcoin Price

Bitcoin is trading at $59,907, down 20% from its March high but up 44% year-to-date.

Bernstein’s Outlook

• Pure-play miners are expected to rebound once uncertainty around the U.S. elections is resolved.
• Bernstein has positive ratings for various miners, suggesting potential growth in valuations and power optimization between AI and Bitcoin cycles.