Bitcoin miners spent the past decade building out cheap electricity and heavy-duty power infrastructure. Now, some of the biggest artificial intelligence (AI) companies in the world are paying billions of dollars to use it.
Key Takeaways:
- Texas grid operator ERCOT is fielding 430 gigawatts of connection requests, mostly from data centers.
- TeraWulf’s 20-year Anthropic lease could generate about $19 billion over its term.
- CoinShares projects most listed bitcoin miners will earn AI income by year’s end.
Tech giants racing to add computing capacity are running into a wall that money alone can’t fix. There isn’t enough available power, and building new electrical infrastructure from scratch takes years. Bitcoin mining companies — with land, substations, and energized sites already in place — are filling that gap.
That shortage explains why hyperscalers are turning to miners rather than building on their own. The assessment comes from Matthew Kimmell, digital asset research analyst at CoinShares Asset Management.
Speaking during a July 14 CoinShares webinar moderated by Todd Rosenbluth, head of research at VettaFi, Kimmell cited new data from the Texas grid operator ERCOT. The agency reported that roughly 430 gigawatts of proposed projects are waiting for grid connection as of June. Kimmell also noted that the median wait time is 1.5 to 2 years and about 90% of those applications are from data centers.
For scale, Kimmell pointed to the record for electricity use on the Texas grid. That record, set in April 2023, was about 80 gigawatts — meaning that the queue adds up to roughly five times the record peak.
TeraWulf Inc. (WULF) illustrated the trend on July 6. The mining company announced a 20-year lease with artificial intelligence (AI) company Anthropic at its Justified Data campus in Hawesville, Kentucky.
The agreement covers approximately 401 megawatts of critical IT load and is expected to generate about $19 billion in contracted revenue over its initial term, according to TeraWulf.
Miners Land a Wave of AI Contracts
Calvin Tintle, senior manager of national accounts and distribution at CoinShares Asset Management, also joined the discussion. He listed a string of similar deals that have been signed just in the past six months, including CleanSpark, Inc. (CLSK) announcing its $6.6 billion, 20-year infrastructure lease on the same day as the webinar. Tintle also spoke on other major deals such as, Core Scientific, Inc. (CORZ) signing a 12-year, $10 billion hosting agreement with CoreWeave, Inc. (CRWV), Hut 8 Corp. (HUT) entering a 15-year, $7 billion lease with Fluidstack, and Cipher Mining Inc. (CIFR) also reaching a multibillion-dollar, Google-backed agreement with Fluidstack.
See more: Bitcoin Miners Are Winning the AI Boom
Rosenbluth asked whether the shift was more marketing than substance. Tintle said that the shift is structural rather than a rebrand. He explained that hyperscalers need land, energized power infrastructure, and grid access — and mining companies already control all three.
CoinShares, which sponsored the webinar, offers exposure to the group through the CoinShares Bitcoin Mining ETF (WGMI). Kimmell said that CoinShares expects roughly 80% of listed Bitcoin mining companies to earn AI revenue by year’s end. That’s up from a business once built almost entirely around cryptocurrency rewards.
Miners Aren’t Giving Up on Bitcoin
Kimmell also added that this shift doesn’t mean these companies have stopped mining altogether. It’s a case-by-case decision, he said, not an industry-wide exit.
According to Kimmell, bitcoin mining still functions as what he called a buyer of last resort for electricity. Unlike an AI data center, a mining rig doesn’t need a signed customer contract to run. It can be switched on or off instantly, he said.
That flexibility lets mining companies monetize stranded, underutilized or cheap power, he said. AI data centers can’t do the same because long-term contracts require higher uptime and networking reliability. Kimmell described the AI push as a diversification of the business rather than a full pivot away from bitcoin.
Tintle agreed. He compared it to Amazon.com, Inc. (AMZN) expanding past books into a broader marketplace. Mining companies are adding revenue streams, he said, without giving up a business that they already know how to run.
Because new bitcoin issuance is capped at 21 million coins, an audience member asked whether mining eventually disappears. Kimmell said that miners will keep processing transactions for fees well after that cap is reached. That isn’t expected for roughly a hundred years.
Kimmell closed the discussion by pointing to a headline he had seen that day. New York, he said, had paused new data center construction. He said pushback like that adds to the scarcity of already energized sites and leaves fewer places for the next round of AI computing demand to land.
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