Bitcoin BTC$115,111.97 Broker Canaccord Genuity said in a report on Tuesday that mining still generates almost all of the sector’s revenue, despite a shift in focus to artificial intelligence (AI).
But Canaccord analysts led by Joseph Vuffy said the pivot makes sense as miners are building vast energy infrastructure for Bitcoin and are in a position to power the next wave of AI data centers.
The evolution of the sector is accelerating due to increased AI investment, increased number of minor AI deals, lower funding costs, and new corporate structures. However, the fundamentals of Bitcoin mining remain strong, with prices near all-time highs and costs in the range of $30,000 to $40,000 per coin, analysts wrote.
Efficiency gains, improved power strategies (particularly in Texas) and fleet upgrades are helping major mining companies maintain profitability and control, the report said.
Canaccord says cheaper capital and investor demand are opening up new avenues, from leasing GPUs to miners building their own AI clouds.
Cipher Mining (CIFR) and IREN (IREN) recently issued $1 billion in zero-coupon convertible notes, and IREN and Hive Digital (HIVE) already operate GPU cloud platforms.
The spinout of American Bitcoin (ABTC) by Hut8 (HUT) highlights a broader shift towards separating mining and energy businesses to unlock value and focus on growth, the report added.
read more: Bitcoin mining profitability drops more than 7% in September: Jeffries
