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Bernstein: large miners are willing to finance arithmetic expansion rather than through coin sales, but investors are more bullish on shares of miners with AI industries

Bernstein: large miners are willing to finance arithmetic expansion rather than through coin sales, but investors are more bullish on shares of miners with AI industries

Bitget2024/09/18 12:37

Shares of mining companies such as Core Scientific, IREN and Terawulf have outperformed competitors focused solely on bitcoin mining due to increased confidence in data-centric theories against a backdrop of bitcoin price volatility, according to analysts at market research and brokerage firm Bernstein.

Analysts say shares of AI-focused mining companies have outperformed thanks to increased investor confidence in the diversification of their business models, higher valuation multiples, more predictable revenue streams, and greater flexibility in the volatile bitcoin market. While their hash rate growth may be generally slower than that of single bitcoin miners, AI-focused miners are simultaneously expanding their data center infrastructure, which provides additional opportunities in the fast-growing AI space.

Large public bitcoin mining consolidators such as Marathon, Riot Platforms, and CleanSpark, which hold large amounts of bitcoin on their balance sheets, have seen the percentage of mining proceeds from sales decline this year compared to the same period in 2023, with the aforementioned miners retaining 100 percent of their production in August. This shift suggests that large miners are willing to raise capital or accept equity dilution to invest in capital expenditures and expand their market share in bitcoin mining rather than liquidate their bitcoin holdings,” the analysts said. Currently, they see AI as a distraction and are not shifting capacity to it.

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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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