Bit Digital to capitalize on AI as secondary revenue source

Bitcoin miners serving AI-curious customers is becoming a trend, with Hive Blockchain and Hut 8 the first to capitalize during the brutal summer months

article-image

Blue Planet Studio/Shutterstock modified by Blockworks

share

Bit Digital announced Monday the launch of a new business segment dedicated to serving clients interested in developing “generative artificial intelligence workstreams.” This move positions Bit Digital as the latest in a series of bitcoin miners venturing into the AI domain.

The business line was dubbed Bit Digital AI. The company has already signed a binding term sheet with an unnamed customer interested in building its own large-language model. Bit Digital will rent out as many as 4,096 Nvidia HGX H100 GPUs to this customer. 

Nvidia introduced these GPUs last April. They are often used for AI workflows because of the high computing speeds they can support — up to 400 gigabits per second. These chips go for around $30,000 each, and Bit Digital has already bought 1,056 of them to rent out to this customer, according to a company press release.

But the company is making a bet that this capital outlay for the chips — funded by a mix of cash, digital assets, new equity issuance and potentially equipment financing — will pay off in the longer term.

In fact, Bit Digital expects this contract to generate $23 million to $27 million in annual revenue if it were to rent out the minimum number of GPUs: 1,024 to be exact. If it stepped up the number of GPUs to the maximum — 4,096 — Bit Digital expects to take home in excess of $250 million over the three-year contract term. 

And revenue is something that’s on the minds of all major bitcoin mining CEOs, especially when the bitcoin halving event is about six months away. Bit Digital CEO Sam Tabar is no exception.

Read more: Galaxy mining head exits to consult miners ahead of halving

“This new venture is an excellent expansion of our platform. This business line aims to provide a non-correlated income stream that will help the Company weather potential downturns in its core bitcoin mining and ETH staking businesses,” Tabar said in a statement.

Bit Digital is certainly not the first to try and diversify away from bitcoin mining, which is inextricably tied to the price of the volatile digital asset. Hut 8 has cultivated clients working in the AI sector who have advanced computing needs. It has potentially taken this course out of necessity, since the firm experienced a 70% dip in bitcoin mining revenue during the first quarter of 2023. 

So has Hive Blockchain, which rebranded itself to Hive Digital Technologies in light of its new focus on serving high-powered customers.

Bit Digital expects to receive the Nvidia GPUs by the end of 2023 at which point they’ll be eventually deployed at a datacenter. Revenue could start flowing in from this venture as soon as January 2024, according to Bit Digital.


Get the news in your inbox. Explore Blockworks newsletters:

Tags

Decoding crypto and the markets. Daily, with Byron Gilliam.

Upcoming Events

Old Billingsgate

Mon - Wed, October 13 - 15, 2025

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

Industry City | Brooklyn, NY

TUES - THURS, JUNE 24 - 26, 2025

Permissionless IV serves as the definitive gathering for crypto’s technical founders, developers, and builders to come together and create the future.If you’re ready to shape the future of crypto, Permissionless IV is where it happens.

Brooklyn, NY

SUN - MON, JUN. 22 - 23, 2025

Blockworks and Cracked Labs are teaming up for the third installment of the Permissionless Hackathon, happening June 22–23, 2025 in Brooklyn, NY. This is a 36-hour IRL builder sprint where developers, designers, and creatives ship real projects solving real problems across […]

recent research

Research Report Templates (19).png

Research

Suilend has grown into the top money market and liquid staking provider on Sui. STEAMM, Suilend’s Superfluid AMM, presents a compelling avenue for growing market share within Sui’s DEX landscape and revenue generation for the protocol. Suilend’s multi-product suite position it well for owning market share across key verticals. While current metrics across the Sui ecosystem are likely inflated due to Sui Foundation incentive programs, SEND trades at amongst the lowest multiples in the lend/borrow sector, suggesting that a bull case for continued growth in the ecosystem may be mispriced.

article-image

The best capital markets are open to the most people — and crypto capital markets are open to everyone

article-image

Post-conference musings on Firedancer, Kraken, Solana Mobile and Trump

article-image

Executives expect others to follow SharpLink Gaming’s lead in purchasing an asset that has surged this past month

article-image

After a weekend of tariff policy shifts, investors appear confident that trade deals are underway

article-image

Multiple rounds of prior audits did not catch the flaw, the DEX said

article-image

StarkWare launches new consumer-grade hardware ZK prover