Rising Bitcoin mining costs are reshaping miners’ business model — CoinShares

The cost of mining Bitcoin has exceeded $100,000 for some miners, according to analysts at CoinShares. They estimate that the share of mining revenue for large data centers could drop from 85% to less than 20% by the end of the year.

The reason is the active shift of mining companies toward high-performance computing (HPC) for artificial intelligence workloads. Over the past year, the share of data center revenue from AI has increased from 10% to 77%.

Experts link this transition to the rising cost of mining a single Bitcoin. According to CoinShares, this cost has reached $82,000 for large companies, up from $56,000 just a few months ago. In the United States, smaller miners may face costs of up to $137,000 per Bitcoin, while in Germany costs can reach $200,000 due to high electricity prices.

The increase in costs is driven by several factors, including rising electricity prices, higher equipment costs (partly due to trade tariffs introduced under U.S. President Donald Trump), and the impact of the halving — the protocol-driven reduction in block rewards.

Analysts note that the current situation could become a turning point for the industry. The shift to a hybrid model (mining + HPC) allows companies to diversify revenue streams and improve business resilience amid Bitcoin’s volatility.

According to CoinShares, revenue from the HPC segment has grown by 80–90%. This encourages miners to sign HPC contracts, the total value of which has exceeded $70 billion based on public data. Companies such as WULF, CORZ, CIFR, and HUT are gradually transforming into data center operators with mining as an additional business line.

“The mining industry is undergoing a deep transformation. Miners are forced to adapt to new economic realities, and the transition to high-performance computing is becoming one of the most promising strategies,” CoinShares stated.

Experts also pointed to another less obvious reason for miners’ diversification: more than 90% of all Bitcoin is concentrated in just 1% of wallets, raising concerns about the original concept of decentralization.

In mid-March, the average cost of mining one Bitcoin rose to $88,000. With the market price around $69,000, miners are operating at an average loss of about 21%, according to earlier estimates by Checkonchain.

See also: "Hut 8 introduces a “Lego-style” approach to switch between AI and Bitcoin mining"

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