Bitcoin (BTC) mining is likely to remain profitable this year, with the economics of production holding steady, according to a recent research report from Canaccord Genuity. The analysis highlights that the mining fundamentals are robust, indicating that the cost to mine a single bitcoin is currently situated in the range of approximately $26,000 to $28,000 for most leading players in the industry.
As of the publication of this report, Bitcoin was trading around $105,000, signaling a lucrative environment for miners. However, beyond just the profitability metrics, a shift in operational focus is occurring within the sector, with management and investor attention increasingly drawn towards alternative uses for these companies’ significant power supplies. One emerging opportunity lies in artificial intelligence (AI) data center hosting.
A prime example of this trend is Bitcoin miner Core Scientific (CORZ), which signed a landmark 12-year contract with AI hyperscaler CoreWeave in June of last year. This deal is being regarded as a potential game changer for the sector, as it positions Core Scientific to capitalize on the burgeoning demand in the AI market.
According to analysts led by Joseph Vafi, the demand forecasts for AI services may eventually dwarf that of the traditional cloud hosting market. This shift presents a unique opportunity for Bitcoin mining operations to diversify their revenue streams and maximize the use of their energy resources.
As 2025 unfolds, more co-hosting deals are anticipated, with potential announcements expected from major companies such as Galaxy Digital (GLXY) and Applied Digital (APLD). This trend underscores a growing recognition within the industry of the dual capabilities of mining infrastructure.
Moreover, larger publicly traded miners are strategically leveraging their access to capital to upgrade their fleets following last April’s reward halving event. This upgrade not only strengthens their competitive position but also enhances their share of the network’s hashrate. The hashrate, which refers to the total combined computational power used to mine and process transactions on a proof-of-work blockchain, serves as a critical proxy for competition and mining difficulty within the industry.
In conclusion, Bitcoin mining, bolstered by strong fundamentals and innovative energy utilization strategies, is poised for an exciting year ahead. As companies navigate this evolving landscape, stakeholders should remain vigilant for upcoming developments that may further shape the future of the industry.
For more insights, read our in-depth analysis on how Bitcoin miners are starting 2025 on a strong footing: Bitcoin Miners Have Started 2025 on a Strong Footing, JPMorgan Says.
