Summary
AI-focused Bitcoin miners are outperforming their peers due to diversified business models and investor confidence. Bernstein analysts highlight significant upside potential for all miners driven by their power portfolios, with predictions of a market cycle acceleration post-U.S. elections. Notably, large miners are increasingly retaining their Bitcoin assets, while AI miners are structured to regularly sell their production for operational sustainability.

Analysts at Bernstein report that AI-focused Bitcoin mining companies are outpacing their competitors due to the growing confidence in their diversified business models. Despite slower hash rate growth compared to pure Bitcoin miners, these AI-oriented firms are simultaneously expanding their data center infrastructure, which allows for the cultivation of opportunities in the flourishing AI sector. Notably, IREN stands out as the fastest growing miner, boasting a fourfold year-over-year increase in hash rate and plans to double its GPU fleet and hash rate by December, with AI cloud services projected to contribute approximately 10% of its earnings by the end of the year. Other large public Bitcoin miners, such as Marathon, Riot Platforms, and CleanSpark, maintain significant Bitcoin holdings while opting to sell a smaller fraction of their mined coins this year compared to previous years. Analysts suggest this trend indicates a strategic shift, where these miners prefer to raise capital for expansion rather than liquidating their Bitcoin assets. In contrast, AI-centric miners tend to sell their entire production to sustain operations and do not prioritize Bitcoin as a treasury asset. As the price of Bitcoin currently sits at $59,907—down roughly 20% from its all-time high—Bernstein notes that all miners possess significant upside potential driven by their control over power portfolios, which currently encompasses about 6GW of capacity globally. The analysts project that public Bitcoin miners could experience an upward cycle following the resolution of uncertainties surrounding the U.S. elections, with potential for valuation adjustments in accordance with their efficiency in power usage and the rising Bitcoin market cycle. Bernstein maintains optimistic ratings for several miners, suggesting targets significantly higher than their current stock prices—reflecting a bullish outlook for the industry in the near term.

The article addresses the performance of AI-focused Bitcoin miners in comparison to pure-play Bitcoin mining firms. It emphasizes the confidence analysts have in the diversified revenue streams of AI miners and the strategic shifts large public Bitcoin miners are taking—retaining a significant share of their mined Bitcoins while also investing in expansion. The current market conditions, coupled with price predictions, illustrate the potential future valuation of these entities amid a recovering Bitcoin market period.

In conclusion, AI-focused Bitcoin miners are experiencing a notable advantage in the market, largely attributed to their robust business models and diversification strategies. Large public miners are adapting their strategies to maintain capital while positioning for potential growth amid evolving market conditions. Analysts predict considerable upside potential exists across the industry, particularly for companies that effectively manage power resources and capitalize on the upcoming Bitcoin cycle.

Original Source: www.theblock.co

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