The rise of artificial intelligence (AI) data centers could significantly impact bitcoin mining economics — even for miners who don’t directly work with AI.
The key factor here is the competition for cheap electricity between AI data centers and bitcoin miners, which could help set a baseline for hashprice, a critical metric used by miners to assess their revenue.
“Now, every potential mining investment is filtered through this lens: is it better to use this site for AI or mining?” said Spencer Marr, president of bitcoin mining firm Sangha Renewables. “Whenever AI or high-performance computing takes priority, it slows down the growth of hashrate, thus preventing hashprice from dropping further.”
Hashrate refers to the total computational power securing a Proof-of-Work blockchain like Bitcoin, while hashprice measures how much bitcoin a miner can earn based on their machine’s computations within a specific period.
Currently, Bitcoin’s total hashrate stands at 770 exahash per second (EH/s), according to Hashrate Index data, with the hashprice at $61.12 per petahash per day. As mining has become increasingly competitive, hashprice has been steadily decreasing. In 2017, for example, hashprice was often over $1,000 per petahash per day.
Having a floor for hashprice would be beneficial for miners, ensuring that the value of computing power doesn’t drop below a certain level, regardless of market conditions.
“The competition for cheap electricity is squeezing miners, as other sectors, particularly AI data centers, are more aggressive in securing power,” Marr explained. “From a game theory perspective, miners benefit when other industries use cheap electricity, leaving more room for Bitcoin mining.”
However, this competition might not necessarily lead to a permanent negative impact on Bitcoin miners. Jaran Mellerud, co-founder of Hashlabs Mining, suggested that miners could simply relocate to regions where AI data centers are less prevalent.
“I don’t think AI competition will significantly affect hashprice,” Mellerud said. “Bitcoin’s mining network is self-correcting, so a decline in hashrate in one region will increase profitability for miners elsewhere, creating room for growth.”
Mellerud predicted that by 2030, AI competition in the U.S. could reduce its share of the global hashrate to under 20%, while regions like Africa and Southeast Asia could see more mining activity.
While Marr acknowledged these points, he noted that there is a limited supply of ultra-cheap electricity, and that AI data centers are more complex to operate than bitcoin mines. They require continuous uptime and are far more expensive to build and maintain.
“Ultimately, competition for cheap electricity may slow down hashrate growth but not halt it entirely,” Marr concluded.
