Public Bitcoin Miners Shed Hashrate to Chase AI Revenue

Highlights

Public Bitcoin miners have cut their realized hashrate by as much as 23% as they redeploy toward AI and HPC infrastructure.
A tracked cohort's hashrate fell from 368.3 EH/s in Q4 2025 to 319 EH/s in Q2 2026; excluding Bitdeer's 44% increase, the decline was steeper at 21.2%.
HPC and AI revenue at the relevant miners grew 52% month-over-month, with some companies' AI revenue now exceeding their mining revenue.
AI cloud revenue runs roughly $940 per megawatt-hour, more than five times an S23 Hydro miner's output and over eight times an S21 Pro's.

A wave of publicly listed Bitcoin mining companies has been quietly cutting the amount of hashing power they actually devote to mining Bitcoin, redirecting electricity, physical sites, and operational staff toward AI and high-performance computing workloads instead. Realized hashrate among a tracked cohort of these miners fell from 368.3 exahashes per second in the fourth quarter of 2025 to 319 EH/s by the second quarter of 2026, a headline decline of 13.4%. Strip out Bitdeer, whose own hashrate actually rose 44% over the same period and skews the group average upward, and the decline across the rest of the cohort was considerably steeper at 21.2%, with some analyses putting the broader shift as high as a 23% cut in real mining capacity.

Crucially, analysts framing this shift have been explicit that it does not read as a capitulation to weak Bitcoin economics or falling prices. Instead, it reflects miners actively choosing to reallocate capacity toward a business line that is currently generating dramatically higher returns per unit of electricity than mining itself.

The Revenue Gap Driving the Shift

The numbers behind that reallocation are stark. HPC and AI revenue at the miners making this transition grew 52% month-over-month, and at some of the furthest-along companies, AI and HPC revenue has now overtaken Bitcoin mining revenue entirely for the first time. On a per-megawatt-hour basis, AI cloud computing revenue runs at a median of roughly $940, more than five times the output of an S23 Hydro-series mining rig and more than eight times that of an S21 Pro, two of the more efficient machines still in wide use across the industry. Even the more modest side of the AI pivot, HPC hosting and colocation revenue, generates around $175 per megawatt-hour, still roughly on par with mining revenue but carrying a structural advantage mining lacks: HPC hosting contracts are typically multi-year agreements with electricity costs passed through to the client, insulating the miner from the kind of power-price volatility that directly eats into Bitcoin mining margins.

The Cost of Making the Switch

The pivot is not without heavy upfront cost. Across the 14 mining companies included in the broader analysis, combined quarterly capital expenditure reached approximately $18.6 billion, a figure close to 15 times the group's quarterly revenue. That scale of spending reflects the reality that converting Bitcoin-mining-optimized sites, built around ASIC racks and the power and cooling profiles they require, into facilities suitable for GPU-based AI workloads is a substantial infrastructure undertaking rather than a simple software or contract change, explaining why the transition is happening gradually across the sector rather than all at once. The capital intensity of the shift echoes a similar redeployment already visible in individual company deals, including Riot Platforms' own $9.1 billion Anthropic data-center deal, which has already begun outearning the company's Bitcoin mining operation.

Real-World Examples of the Shift

Two named companies illustrate how far the transition has already progressed for early movers. Core Scientific generated $136.7 million in colocation revenue during the second quarter, dwarfing the $27.5 million it brought in from Bitcoin mining over the same period. TeraWulf posted a similar pattern on a smaller scale, with $31.9 million in HPC lease revenue against $12.8 million from mining. Both figures illustrate just how lopsided the economics have become at companies furthest along in redeploying their infrastructure, and offer a preview of where the broader cohort of public miners may be headed if the revenue gap between AI hosting and Bitcoin mining persists — a gap wide enough that even bullish long-term Bitcoin price targets from analysts like Bernstein haven't stopped miners from hedging their bets on AI infrastructure instead.

What to Watch Next

The key variable going forward is whether Bitcoin's own mining economics, hashprice and network difficulty, stabilize enough to narrow the revenue gap, or whether AI and HPC demand keeps growing fast enough to pull even more capacity away from mining. Also worth watching is whether the heavy capital expenditure required for the pivot strains balance sheets at miners without Core Scientific or Riot's scale, particularly since Riot itself sold $732 million in Bitcoin through the first half of 2026 partly to help fund its own buildout, potentially forcing smaller players to either partner with larger AI infrastructure operators or abandon the transition altogether and refocus purely on mining.

FAQ

How much hashrate have public Bitcoin miners cut?
A tracked cohort's realized hashrate fell 13.4% overall, or roughly 21-23% when excluding Bitdeer, whose own hashrate rose 44% over the period.

Why are miners cutting Bitcoin hashrate?
They are redeploying electricity, sites and staff toward AI and HPC hosting, which currently generates far higher revenue per megawatt-hour than Bitcoin mining.

How much more does AI revenue generate than mining?
AI cloud revenue runs around $940 per megawatt-hour, more than five times an S23 Hydro miner's output and over eight times an S21 Pro's.

What is the cost of making this transition?
Across 14 mining companies, combined quarterly capital expenditure reached about $18.6 billion, roughly 15 times the group's quarterly revenue.