30s Summary

Bitcoin miners are using artificial intelligence to mitigate the expense and difficulty spikes caused by the Bitcoin network’s halving in April, according to crypto asset manager CoinShares. CoinShares’ Q3 report revealed that despite falling revenues and hash prices, miners continue to invest in new infrastructure in anticipation of future price rises. Given the variances in Bitcoin mining costs – influenced by factors such as power source and equipment efficiency – operations are diversifying their income sources, including integrating AI. Some miners are also considering mergers and acquisitions to lower their operational expenses.

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Bitcoin miners are looking for ways to reduce expenses and are turning to artificial intelligence, as they deal with the impacts of the Bitcoin network halving back in April, according to cryptocurrency asset manager CoinShares.

Mining Bitcoin has been getting pricier and more difficult, leading to different outcomes for various Bitcoin miners. CoinShares’ recent report for the third quarter says that the Bitcoin mining industry has faced major obstacles. Although revenues and hash prices have dipped, miners are still investing in new infrastructure and committing to more expansion, hoping for future price surges.

For those unfamiliar, the Bitcoin network’s halvings happen every four years and basically cut the amount of Bitcoin created per block in half. The event in April reduced mining rewards from 6.25 BTC to 3.125 BTC for each block, which significantly bumped up the real-world costs of mining a single Bitcoin.

CoinShares estimates that the average cost to produce one Bitcoin across all miners is now roughly $49,500 based on the second quarter’s data—an uptick from $47,200 in the first quarter. This basically means that, even at current prices, mining remains profitable for many operations.

Comparatively, Bitcoin miners Cormint and TeraWulf are sort of getting the best deal, paying about $15,000 and $19,000 in electricity costs for each Bitcoin produced. This is significantly lower than the estimated $20,000-plus in power costs that other miners encounter. In fact, some miners such as Marathon Digital Holdings and Hive Digital even spend over $40,000 on electricity for each Bitcoin produced.

Bitcoin mining costs can vary depending on factors like the miners’ power source, utility contracts, and their mining equipment’s efficiency. According to CoinShares, the less profitable Bitcoin mining operations could be causing a trend where companies diversify their income sources to include stuff like AI.

For example, Bitcoin miner Hive invested a whopping $66 million in Nvidia’s graphic processing units (GPUs), which are typically used for things like AI work. On top of that, some Bitcoin miners are also looking into mergers and acquisitions as one way to drive down those Bitcoin mining costs. As a case in point, JPMorgan reported in August that some financially solid miners like Riot Platforms and Cleanspark bought other miners with ready-to-go facilities to up their near-term hashrate and expand their power pipeline.

Source: Cointelegraph