Crypto Miners Pivot to AI Amidst Profitability Crisis
Record-Low Profitability
In late 2025, Bitcoin mining profitability hit unprecedented lows as the hash rate fell below $35 per petahash per second, with production costs spiking to $44.8 per petahash. This situation extended payback periods to over 1,200 days, prompting a significant industry shift. Currently, 70% of top mining firms are deriving revenue from artificial intelligence infrastructure.The month of November 2025 was pivotal for Bitcoin mining, with declining margins and regulatory pressures reshaping the sector. Here are the top trends that emerged.
AI Transition Gains Momentum
Major mining companies are increasingly generating revenue from AI services. AI hosting revenues exceed traditional mining returns by 50% per megawatt. Bitfarms plans to convert its Washington State facility into an HPC data center by 2026, expecting returns to surpass those from Bitcoin mining.
IREN secured a $9.7 billion agreement with Microsoft for GPU cloud computing, featuring a 20% upfront payment. IREN will install NVIDIA GB300 GPUs at its Texas facility from 2026.
Significant Financial Restructuring
Convertible note issuances are prevalent across the industry. CleanSpark raised $1.15 billion at 0% interest, while TeraWulf completed a $1.025 billion offering at the same rate. Cipher Mining issued $1.4 billion in senior secured notes at a 7.125% yield.
Equipment investments are substantial, with IREN securing a $5.8 billion deal with Dell for NVIDIA GPUs. Canaan received a $72 million investment from BH Digital, Galaxy Digital, and Weiss Asset Management to support high-performance computing and energy infrastructure.
Regulatory Developments
In Malaysia, authorities discovered approximately 14,000 illegal mining operations over five years, resulting in $1.1 billion in damages to the state utility TNB. A government task force was established to intensify crackdowns.
Russia is employing AI technology to tackle illegal mining, with state grid operator Rosseti using AI analytics in smart meters to detect power anomalies. Meanwhile, Japan initiated its first government-linked mining project, deploying water-cooled Avalon miners for grid balancing.
Strategic Bitcoin Accumulation
Leading miners are stockpiling Bitcoin rather than selling. MARA holds 53,250 BTC, valued at around $5.6 billion. CleanSpark reported 13,054 BTC as of November 30, while Cango holds 6,412 BTC with a commitment to long-term holding. This accumulation strategy reflects confidence in Bitcoin's long-term value, with miners betting on rewards after surviving the current crisis.