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The improving economics of block reward mining on the BTC network didn’t last long, but the AI data center business is giving miners reasons to smile—and more reasons to quit mining.
- Mining economy’s ‘false dawn’ proves all too brief
- MARA turfing mining staff whose skills are no longer needed
- CleanSpark’s cost of mining BTC hit 136% of token price in Q1
- IREN sees AI revenue up, mining revenue down
- TeraWulf AI revenue tops mining for the first time, will be “out of” mining by 2027
Mining economics seemed to be improving last month, but the current forecast for BTC’s next network difficulty adjustment on May 15 is a nearly three-point rise to 136.1 trillion hashes (the average number of guesses required to ‘find’ a new block and claim the current block reward of 3.125 BTC).
Right on time, some ugly U.S. inflation numbers caused the BTC token’s fiat price to tumble on Wednesday, ending a roughly six-week uphill journey from ~$67,000 to over $82,000. As of Wednesday afternoon, BTC’s price is sitting around $79,500, while the average all-in cost of mining a single token is around $3,000 higher.
This mining rug-pull will likely only accelerate the sector’s ongoing pivot to artificial intelligence (AI), leaving fewer and fewer operators willing to continue securing the BTC network. (That’s okay with at least one operator.) That transition is being reflected in at least one miner’s monthly production numbers.
Bitdeer (NASDAQ: BTDR) is by no means ignoring AI, as April’s AI cloud revenue rose 60% from March to $69 million. Bitdeer’s number of GPUs powering its AI operations nearly doubled from March’s 2,128 to 4,184 by the end of April.
But Bitdeer began life as an ASIC mining rig manufacturer and, since fewer customers are interested in expanding their ASIC fleets nowadays, Bitdeer has ramped up its self-mining operations using the rigs it can no longer sell.
Bitdeer said this week that its self-mining ops produced 783 BTC in April, up significantly from March’s total of 661, as its total number of self-mining rigs rose by 26,000 to 251,000. But despite all those BTC coming in, Bitdeer finished April with just 73 tokens on hand, as the proceeds of their sales are needed to fund that AI pivot.
It’s a different story for Cango (NYSE: CANG), despite its beginning life as an offshoot of the largest ASIC manufacturer, Bitmain. Cango said last week that its self-mining hashrate as of April 30 was 20.4 EH/s, down 7.5 points from March and down 14 points from February. Cango blamed the decline on its switching off older, unprofitable Bitmain rigs as it awaits the arrival of newer models.
Cango’s AI pivot has led to some confusion regarding what it’s disclosing to the public. The company said its April BTC production was 230 tokens, while its March report didn’t offer any production figure. (Was it zero?) Regardless, the April figure is barely half the number it reported producing in February, reflecting its ongoing ASIC fleet ‘optimization.’
Bitdeer releases its Q1 earnings report on Thursday, May 14, but sadly, that’s too late for our publication deadline, so we’ll have to wait to see how all this upheaval is affecting its bottom line. Fortunately, we have four other miners’ reports to pore over. So let’s get stuck in…
MARA turfs 15% of staff whose mining skills were no longer needed
MARA (NASDAQ: MARA) reported revenue falling 18% year-on-year to $174.6 million in the three months ending March 31, while its net losses more than doubled to $1.26 billion. However, that latter figure is an improvement over the $1.7 billion loss the company reported in the final quarter of 2025.
The Q1 loss was driven by a $1 billion decline in the value of MARA’s BTC ‘treasury,’ which the company has been gradually liquidating. The sales are intended to fund MARA’s ongoing transition from mining to running data centers that serve AI and other high-performance computing (HPC) firms.
Two months ago, MARA was sitting on a treasury containing 53,822 BTC, second only to Michael Saylor’s Strategy (NASDAQ: MSTR). MARA now sits in fourth place on the BTC treasury chart with 35,303 tokens. In March, MARA acknowledged it was “opportunistically” selling some of its holdings but denied that it planned to dump its entire BTC stack.
MARA insists that its mining operations are “not a legacy business we are moving away from. It is the operational foundation on which we are building … we can generate revenue today through Bitcoin mining while preserving the option to redirect power toward AI and critical IT loads as those opportunities mature on the same sites.”
But MARA stated elsewhere that it would continue mining “until data center demand repurposes capacity, supporting revenue continuity during transition.” Which sounds a lot more like a concrete plan than an option they’re considering.
MARA notes that “the broader Bitcoin market is supported by institutional demand, while retail participation remains comparatively subdued. In our view, that creates a constructive setup over time, with a bias to the upside if institutional buying continues and retail demand returns.”
But that’s a big ‘if,’ and MARA says it has no plans to “pursue large-scale ASIC purchases.” Instead, MARA said it recently “acquired 2.4 EH of next-generation used ASIC miners at prices equivalent to a full replacement.”
The AI pivot led MARA to cut 15% of its workforce in Q1, and the company was asked on the earnings call whether more mining-focused staff would be “repositioned” as the pivot continues. MARA CFO Salman Khan said the cull came after the company asked itself, “What are the skills that we are missing that we need to add to get there, and what are the skills that we do not need for the growth of our previous peer-to-peer Bitcoin mining business?”
On April 30, MARA struck a $1.5 billion deal to acquire Long Ridge Energy & Power’s 505 MW gas power plant in Hannibal, Ohio, and 1,600 surrounding acres to support “an integrated digital infrastructure campus.” MARA CEO Fred Thiel said, “Power is the scarce input in AI,” and Long Ridge offers “a rare combination of large-scale power, land, water access, fuel supply, and grid interconnection in a single location.” MARA expects to begin construction of its new ‘campus’ in H127 and for that campus to be “ready for service” by mid-2028.
MARA’s share price took a slight hit after its earnings were released, but has since regained some of that lost ground, closing Wednesday at $12.75. For the year-to-date, MARA is up 42% and currently sits at nearly twice the sub-$7 range it fell to during its early-February swoon.
CleanSpark’s cost of mining BTC hits 136% of token value
CleanSpark (NASDAQ: CLSK) suffered a similar treasury-related fate in its fiscal Q2 ending March 31, booking a net loss of $378.3 million, only slightly better than the $378.7 million loss in its fiscal Q1. The loss was driven by a $263 million decline in the value of the 13,561 BTC in CleanSpark’s treasury, but that wasn’t the only set of fingerprints on this knife.
Q2’s revenue slipped nearly one-quarter to $136.4 million, which the company blamed on the corresponding slump in BTC’s fiat price. As evidence, they cited the fact that CleanSpark mined only 22 BTC fewer than in Q1.
While the cost of power was slightly cheaper in Q2, it wasn’t enough to compensate for the mining sector’s ugly economics during the quarter. CleanSpark is one of the few miners to detail its all-in cost of mining a single BTC token, including depreciation on its ASICs and the cost of replacing old rigs with newer, more efficient ones. During Q2, this cost averaged $103,440 while average revenue per BTC mined was $75,827, making the cost 136.4% of the price, up from 83.8% in the same period last year.
Like most miners, CleanSpark is leaning into AI/HPC, although it’s yet to announce a major AI client. Company CEO Matt Schultz said earlier this month that CleanSpark was making “meaningful headway” in securing Customer #1 while also insisting that the company wasn’t abandoning mining just yet.
On the analyst call, CFO Gary Vecchiarelli concurred, saying CleanSpark is “building on mining, not moving away from it … mining is really our functional currency going forward, and that’s what’s going to pay the bills until we get a stabilized lease.”
Asked whether the company might mix mining with AI at the same facilities, Vecchiarelli said that if a specific facility is “energized, we can pop down some mining pods and actually monetize that energy while we’re waiting for the AI site to be built.”
CleanSpark produced 640 tokens in April, down slightly from 658 in March, as its average operating hashrate slipped a point to 46.2 EH/s.
Like MARA, CleanSpark shares took a dip following its earnings report, but the shares are up nearly one-third since the year began, closing Wednesday down 1.3% to $13.30.
IREN Q1 sees AI up, mining down
IREN (NASDAQ: IREN) is a little more ahead of the game than most miners when it comes to its AI pivot and shows no sign of ceding that advantage. Last week, IREN announced a deal to acquire cloud infrastructure firm Mirantis in an all-share deal worth $625 million.
IREN co-founder/co-CEO Daniel Roberts said Mirantis “builds on our existing capabilities and strengthens how that compute is deployed, managed and operated for customers.” On May 12, IREN announced plans for a $2.6 billion debt offering to further its AI expansion.
IREN’s fiscal Q3 showed revenue falling 21.6% from the final quarter of 2025 to $144.8 million, with mining accounting for $111.2 million of that sum. However, the cost of that mining revenue (excluding depreciation/amortization) fell 44.3% to $35.3 million, “primarily driven by lower electricity cost resulting from reduced Bitcoin mining capacity.”
Meanwhile, AI Cloud Services revenue doubled to $33.6 million, while costs came in at just $4.6 million. The AI revenue surge was even more dramatic on a year-on-year basis, rising more than 12-fold.
IREN booked a net loss of nearly $248 million for the quarter, nearly 60% worse than the prior quarter, although $140.4 million of this red ink was due to writing off much of its mining gear. As of March 31, IREN had put up 5,800 Bitmain S21 Pro ASICs up for sale as they “were no longer in use,” although the company says it’s “highly probable” that they’ll be able to unload them.
For the record, analysts didn’t ask one mining-related question on IREN’s earnings call. But there was keen interest in IREN’s new $3.4 billion AI Cloud contract with GPU maker Nvidia(NASDAQ: NVDA), as well as the two companies’ strategic partnership to deploy “NVIDIA-aligned infrastructure and architecture across IREN’s 5GW global data center pipeline.”
IREN shares closed Wednesday down 2.5% to $55.17, and are up 46% since the year began.
TeraWulf to be done with mining by next year
TeraWulf (NASDAQ: WULF) is another miner making a hard pivot, as AI/HPC has now eclipsed its mining operations in terms of revenue. Figures released last week show Q1’s digital asset revenue falling 50% from Q425 and 62% year-on-year to just $13 million, while HPC lease revenue—which didn’t exist during the first three months of 2025—brought in $21 million, up from $16.9 million in Q425.
But switching horses midstream is neither easy nor cheap, and TeraWulf booked a Q1 net loss of $427.6 million, with only $653,000 of that blamed on BTC’s falling price. The rest of the red ink involved shutting down mining operations and building out new AI/HPC ones.
As CEO Paul Prager put it on the analyst call, TeraWulf is “transitioning portions of our legacy mining footprint to support higher-value HPC workloads. That transition is deliberate. Mining served its purpose. It enabled us to build infrastructure, monetize power, and develop operational expertise. The future of this platform is contracted, long-duration compute infrastructure.”
TeraWulf CFO Patrick Fleury concurred, emphasizing the difference between “volatile” mining revenue and “stable” HPC contracts. Fleury said TeraWulf’s hashrate was currently sitting at a mere 5-6 EH/s and the company “won’t be putting any significant amount of money into that business.” Fleury added that “beyond this year … I think we will likely be, you know, out of that business, certainly by the next halving” in 2028.
TeraWulf shares closed Wednesday up 1.4% to $23.12 and have more than doubled since the year began.
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