Treasury, AI Fill Halving Gap ⛏️
15 months on BTC miners explore pivot options
In April 2024, Bitcoin’s fourth halving quietly reset the game for miners. The reward for each block dropped from 6.25 to 3.125 BTC. The market, at first, didn’t care. The price barely moved. But for miners, whose margins were already thin, the math got harder overnight.
It meant they had to put in the same effort for half the paycheque.
Maintaining the course meant paying for energy and upgrading rigs. Some tried. Most saw their revenues dwindle. Mining profitability slid from averaging around $0.08 per day for 1 terahash/second to $0.055 per day for 1 terahash/second.
Everyone knew the halving was coming. Most of them prepared for business pivots and stopped selling the Bitcoin they mined. Same cost and lower revenue meant reduced margins. Instead, they stacked the Bitcoin betting on its long-term value.
And then they didn’t stop. Michael Saylor’s Strategy (then called MicroStrategy) had already set a template with its Bitcoin bet.
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Marathon, already the biggest miner by treasury size, added over 30,000 BTC to its balance sheet in just over a year since the halving. It had mined at least 8,900 of them and bought more than 21,000 from the open market.
Riot held onto every satoshi it mined (~5,000) for 12 months straight since halving and has bought over 5,000 more during the same duration. Even Hut 8, with relatively modest production, added more than a thousand BTC since the halving and sold barely anything from its stack.
Hive, recovering from Ethereum’s shift to proof-of-stake, grew its Bitcoin reserves by over 25% since halving before selling some to fund expansion. Core Scientific, after coming out of bankruptcy with an empty wallet, added more than 900 BTC since halving, 700 of which came in a single quarter. This, from a miner that had once sold every coin just to stay alive.
All these were not the actions in the normal course of a Bitcoin miner’s business, but desperate acts of someone trying to evolve.
It signalled one thing: stacking sats was no longer a stopgap move. It showed belief in Bitcoin’s upside, yes. But it also showed something else.
Building a Bitcoin treasury would help as long as its price appreciates in the long run. But asset appreciation isn’t the same as revenue. It cannot pay for day-to-day operations.
Post-halving, margins got tighter. Mining Bitcoin cost more than ever, and many realised the old model — mine, sell, repeat — wouldn’t cut it anymore. Some miners saw they already had the essentials to pivot: facilities built for power-hungry machines. Instead of only mining Bitcoin, they began repurposing their infrastructure for AI compute.
Core Scientific was the first to move loudly. In June 2024, it signed a 12-year, $3.5 billion deal to host GPU infrastructure for CoreWeave, an AI cloud provider. It was one of the largest AI hosting deals on record. The contract gave Core a long-term revenue stream with little correlation to Bitcoin prices. It also triggered a quiet scramble across the mining sector.
Riot followed suit. In January 2025, halted a planned 600-megawatt Bitcoin expansion at its Corsicana site and began repitching the space to hyperscalers and AI firms. The company went from scaling hash rate to shopping for AI tenants. Corsicana was designed for scale, with 1 GW of power and a large land footprint. Riot saw more value in leasing that to an AI operator than installing more ASICs.
Hut 8 went in a different direction. It spun off its entire mining division into a separate entity called American Bitcoin, keeping an 80% stake. That freed up the parent company to focus on data centre infrastructure and AI services. In September 2024, Hut 8 launched Highrise, a GPU-as-a-service unit that started with a thousand Nvidia H100s and a five-year contract with a cloud customer. Earlier this year, it announced a 300 MW campus in Louisiana dedicated to high-performance computing.
Hive, which had a long history of GPU mining before Ethereum’s Merge, leaned on its legacy. It repurposed over 4,000 older GPUs for cloud compute, then deployed H100 and H200 clusters in Quebec. By early 2025, Hive was generating an annual AI revenue run-rate of $20 million and aiming for $100 million by the following year. It sold some Bitcoin along the way, but it held on to most of what it mined in 2024.
Even Marathon, the most Bitcoin-maxi of the bunch, adjusted course. It appointed two AI industry veterans to its board in September 2024. It developed immersion cooling rigs designed for AI inference workloads. In early 2025, it began exploring data centre co-location for AI clients. The company ended May 2025 with more than 49,000 BTC. It had sold almost nothing it mined since April 2024.
Iris Energy went all-in on the AI gambit. It sold every coin it mined and bet everything on scaling its data centres. By mid-2025, it had deployed over 4,000 GPUs and was building facilities in Texas and British Columbia with capacity for 20,000 more. Its treasury remained empty, but its infrastructure was growing fast.
Some miners are treating Bitcoin like a strategic reserve. Others see it as inventory to be cashed in for growth. But either way, they’re all trying to stretch the same set of assets – cheap land, stranded energy, grid access, and specialised cooling – into something more useful than just mining.
Mining alone no longer guarantees survival.
Electricity prices didn’t budge. Hash rate kept climbing. The miners that survived did so by adding optionality. Some became service providers. Some became cloud-computing vendors. Many are still figuring it out by experimenting.
For now, most of them still mine Bitcoin. But it’s no longer the whole business. It’s just one revenue stream in a stack that might soon include AI hosting, GPU leasing, energy brokerage, and even sovereign-scale compute infrastructure.
It is too early and too little data to judge if miners’ AI pivots have paid off. Although the high-performance computing (HPC) business hasn’t yet scaled for everyone, it helps that AI compute margins are significantly higher than mining, measured per megawatt.
For some it’s begun to show some signs.
Iris Energy’s revenue from AI services grew from negligible to $2.2 million for June 2025. The relatively new business unit recorded a 98% profit-to-revenue ratio as against 75% in the mining business.
It’s not a guaranteed playbook, though. Building for AI is expensive. It needs more than power: networking, redundancy, cooling, and clients who can fill racks consistently. Not every miner will get it right. Some will overbuild. Some will miss the market turn. Some will still be entirely reliant on Bitcoin in a few years.
The sector is no longer one-dimensional.
They started out stacking blocks. Then they started stacking Bitcoins. Now, they’re stacking GPUs. Yet Bitcoin mining hasn’t stopped.
Most of those who pivoted to AI are still mining Bitcoin.
Bitcoin hashrate hit an all-time high last month and is much above what it used to be around the time of halving. This signals increasing mining difficulty and costs, since miners have to employ more compute resources to solve a block and earn the rewards.
It becomes difficult to make economic sense for a business to sell the mined Bitcoin at lower margins in such scenarios. Unless BTC prices rise or transaction fees spike, only the most efficient operations stay profitable.
Achieving efficiency could mean bringing down the cost of power and computation. It could even mean holding Bitcoin and selling it only when prices break out far beyond the post-halving average. That explains the pivot by most of these miners to AI for a higher return on investment.
That's it for today. See ya tomorrow.
Until then … stay curious,
Prathik
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