Whinstone CEO Chad Harris recently showcased the largest bitcoin mine in North America to CNBC.
The sudden surge in deal-making among crypto companies can be attributed to the growing demand for artificial intelligence (AI). Bitcoin mining companies, equipped with expansive data centers and access to fiber lines and large amounts of power across the U.S., are ideal for AI operations.
After the bitcoin halving event in April, which occurs approximately every four years, generating new tokens became less profitable for miners. Some operators are now exploring exit strategies due to the decrease in industry revenues.
To adapt and diversify, miners are entering into mergers, financings, and partnerships with AI companies. For instance, U.S. bitcoin miner Core Scientific recently expanded its deal with CoreWeave, a Nvidia-backed startup, to provide computing infrastructure to support AI operations. This deal is expected to generate significant revenue for both companies.
Similarly, Hut 8, a Miami-based crypto mining company, is pivoting to AI and recently secured a customer agreement with a venture-backed AI cloud platform. Hut 8’s CEO highlighted the company’s focus on commercial agreements for their new AI vertical.
Another player in the industry, Bit Digital, is supplying Nvidia GPUs to a customer in a bid to increase its revenue from AI. The company is financing the deal with a mix of cash and digital assets on its balance sheet.
Despite most recent deals involving miners, there have been exceptions like trading platform Robinhood, which agreed to acquire Bitstamp, a Luxembourg-based crypto exchange. This move aims to strengthen Robinhood’s crypto operation and compete with other major players in the market.
As the industry continues to evolve, companies are increasingly looking to AI and other innovative technologies to drive growth and profitability.