Institutional Interest in Bitcoin Mining
Institutional investors are increasingly attracted to Bitcoin mining companies due to their potential in artificial intelligence (AI). However, they might also benefit from unexpected Bitcoin bull markets.
According to a recent report by Bernstein, as they forecast Bitcoin prices to reach $200,000, investors entering the mining space for AI could find themselves enjoying the perks of a cryptocurrency surge.
Source: Bernstein
This unexpected synergy between AI infrastructure and cryptocurrency mining is capturing the attention of institutional investors who are looking beyond traditional tech boundaries. Bitcoin miners are uniquely positioned to leverage substantial power resources and strategic locations.
Power Resources
Bernstein notes that Bitcoin miners currently access 4GW of power, with operational interconnect projected to reach 6GW by the end of 2024. This extensive infrastructure is critical as it aligns perfectly with the power-intensive demands of AI computing.
Source: Bernstein
The report also highlights a re-rating opportunity for Bitcoin miners, suggesting that while they trade at a discount compared to legacy data centers, their power portfolios are equivalent. The revenue per megawatt (MW) for Bitcoin miners is significantly lower, yet as they develop AI data center campuses, this gap may narrow.
Strategic Locations
Bitcoin miners have strategically established operations near stranded power sources in unconventional locations, which has resulted in sprawling mining sites with capacities ranging from 100MW to 1GW. For example, TeraWulf's Lake Mariner site in New York has a potential 500MW hydropower capacity, crucial for cooling both cryptocurrency and AI operations.
Expertise in Power Management
Beyond just access to power, Bitcoin miners possess expertise in sophisticated power cost management, which includes hedging strategies in wholesale markets and strong relationships with utilities. This know-how could be invaluable in meeting the energy demands of AI computing.
Edited by Stacy Elliott.
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