Bitcoin Miners Shift to AI, but VanEck Warns of a $50 Billion Reality Check

More and more bitcoin miners are putting their power capacity to work for AI services, but VanEck warns that the market may be pricing these new revenue models too high.

Key Takeaways

• Bitcoin miners are using their energy infrastructure more and more for AI and HPC applications after profit drops from the 2024 halving.
• Companies like Core Scientific, TeraWulf, Marathon Digital, and Riot Platforms are signing AI contracts or choosing a hybrid model.
• VanEck warns of a possible valuation correction of about $50 billion because of tough valuation questions and high investment and execution risks.

The bitcoin mining sector is going through a major shift, with many companies putting their energy infrastructure to work for AI applications. After profit declines from the 2024 halving, miners are looking for new revenue streams in the fast-growing AI market. Still, VanEck warns that this shift comes with major challenges and a possible valuation correction of about $50 billion (€43,1 miljard).

From Bitcoin Mining to AI Infrastructure

Several major miners like Core Scientific and TeraWulf have signed contracts with AI startups and high-performance computing (HPC) customers to convert their data centers. That means they are no longer just mining bitcoin, but also supporting AI workloads. Other players like Marathon Digital and Riot Platforms are taking a hybrid approach, where mining and AI exist side by side. These strategies reflect the hope that tech companies will pay more for power and data center capacity than traditional mining operations.

Investors and Valuations Under the Microscope

Even though bitcoin is down about 24% in value this year, many miners have actually posted stock gains, with Riot Platforms standing out at nearly 94% higher. Investors seem to be putting more value on the fact that these companies have AI potential, which is showing up in higher valuations than pure mining companies get. VanEck, though, says the market is still struggling to value companies that sit between two worlds: falling mining results and AI operations that are barely generating any cash flow yet.

A key valuation metric right now is "energized power" , the operating capacity of the infrastructure. Companies with signed AI contracts are getting valuation multiples of more than 10 times that capacity, while miners without those contracts are valued lower. On top of that, the quality of AI customers will matter more and more; companies working with large, creditworthy hyperscalers can benefit from lower financing costs and higher valuations.

Challenges and Opportunities for the European Market

The move into AI infrastructure requires heavy investment and technical upgrades, including specialized hardware like GPUs, which are in short supply worldwide. That makes building and running large-scale AI data centers complex and capital-intensive. For European investors and market participants, this trend could matter because it shows how traditional mining companies are adapting to new technology and market demand. It also highlights the importance of execution over just ambitious announcements, something the European crypto market may be able to learn from.

VanEck sees the sector's future mainly in the ability to actually turn megawatts of leased capacity into working data centers, on time and on budget. The companies that pull that off will likely become the leaders in this new phase of the crypto market.

The pressure on miners did not come out of nowhere: the recent drop in bitcoin mining difficulty already showed how quickly margins can weaken when the price comes under pressure. That is exactly why some players are now moving faster toward alternative revenue from AI and HPC.