From BTC to HPC: Miners signal evolving focus after the halving

Industry players have started realizing high-performance computing-related revenues as they buy Nvidia GPUs and secure customer deals


Mark Agnor/Shutterstock modified by Blockworks


Bitcoin miners have spoken after the halving. 

Many have said they are looking to wade deeper into the high-performance computing (HPC) space in a world of lower BTC rewards.  

HPC proved an oft-heard acronym out of the mouths of industry executives in recent weeks as the segment’s companies reported first-quarter results — and more importantly, detailed future growth strategies. 

Sure, miners continue looking to improve efficiency and reduce costs via upgrading hardware and mining algorithms, noted BlocksBridge Consulting founder Nishant Sharma. 

But the per-block rewards drop from 6.25 BTC to 3.125 BTC on April 19 has kept companies focused on building out their ex-mining revenue streams.

“A trend that started before [the] halving and appears to be gaining traction among bitcoin miners is repurposing bitcoin mining infrastructure for HPC and other [AI] applications,” Sharma told Blockworks.

This is not exactly a new trend. Hive Digital Technologies was among the first to get serious about this pivot by tweaking its company name in July 2023. It noted at the time that its 38,000 Nvidia GPUs — or graphics processing units — have the capability to do AI workload.

It remains early days, as Hive realized $900,000 of HPC-related revenue in the fourth quarter.  The company has not reported revenue marks for the first three months of 2024. 

But others have. 

Bit Digital, Iris Energy and Hut 8 are among the miners that have started reporting the revenue earned from the HPC business line.

“I believe more companies will start doing so after their AI/HPC ventures become operational,” Sharma said. 

Bitcoin mining giant Hut 8 reported $3.3 million in revenue under its “high-performance computing, colocation and cloud” umbrella — roughly 6% of the revenue it generated during the quarter. 

CEO Asher Genoot called the company’s HPC business “sub-scale” in March, noting its infrastructure would need more investment to handle AI machines.

Read more: Bitcoin miner Hut 8 doubles down on diversification, discipline around halving

But the company earlier this quarter launched a new AI vertical under a “GPU-as-a-service model,” he noted on Hut 8’s Wednesday earnings call. It purchased 1,000 Nvidia GPUs and secured a deal with an unnamed AI cloud platform. 

Genoot said he expects revenue generated from the new vertical to start in the year’s second half, with a forecasted annual rate of roughly $20 million.

“Today, we believe bitcoin mining generates the highest return on investment into large scale stranded load interconnection assets,” the Hut 8 CEO added on the call. “However, we also see a massive opportunity in the broader energy infrastructure sector as demand grows across new use cases like AI.”

Read more: The Bitcoin halving is over — greener mining is coming

A bit further along on the HPC revenue journey was Bit Digital, which saw about $8 million in revenue — 27% of its total first-quarter revenue — come from HPC.

That business started generating revenue in January. Bit Digital disclosed the new unit — focused on supporting generative AI workstreams — in October, noting it had bought 132 integrated HPC platforms and 1,056 GPUs for $35 million. 

Meanwhile, Iris Energy is also still building out its AI cloud services business. 

The Australia-based miner generated $600,000 in revenue from that segment during the first quarter after commissioning 248 Nvidia GPUs to customer Poolside AI. 

It bought 568 additional Nvidia H100 GPUs for $22 million in February. Those were expected to be delivered this quarter.   

Other HPC-centric aspirations

Though others — such as Core Scientific, Stronghold Digital Mining and Terawulf — don’t yet have a dedicated HPC revenue line listed, that doesn’t mean they aren’t committed. Or at least mulling what it could do for their business. 

Core Scientific’s “significant advantage” over industry peers is its exclusive control over its in-demand high-power data center infrastructure, CEO Adam Sullivan said during an earnings call last week.

That HPC segment is “the next major growth opportunity for our business,” he added.

Core Scientific said in March that it would lease up to 16 megawatts (MW) of capacity in its Austin data center to cloud provider CoreWeave, with possible revenue from the deal exceeding $100 million. More than 500 MW of the miner’s total 1.2 gigawatts of contracted power can be utilized for alternative compute workloads, executives noted.

Read more: Rival miners Marathon, Core Scientific each think they have an edge over peers

Stronghold Digital Mining opened up the possibility of selling its assets, or the company outright, on its May 2 earnings call. 

CEO Greg Beard wanted listeners to know that its 130 MW of energized data center capacity could expand to more than 400 MW — with a possible focus on supporting AI and machine learning.

Meanwhile, Maryland-based mining company Terawulf is finalizing the design for the HPC section at its Lake Mariner Facility in New York. It has committed a 2 MW power block capable of deploying thousands of GPUs. 

Joe Flynn, an analyst at Compass Point Research & Trading, estimated in a May 14 research note that Terawulf could generate up to $1.5 million of yearly revenue, per megawatt, from HPC co-location services. 

He added: “We continue to prefer miners that own and operate their own infrastructure, and believe there is optionality for [Terawulf] to pursue AI/HPC opportunities that would lead to a re-rating of the stock from long-term and more predictable free cash flows.”

Start your day with top crypto insights from David Canellis and Katherine Ross. Subscribe to the Empire newsletter.

Explore the growing intersection between crypto, macroeconomics, policy and finance with Ben Strack, Casey Wagner and Felix Jauvin. Subscribe to the On the Margin newsletter.

The Lightspeed newsletter is all things Solana, in your inbox, every day. Subscribe to daily Solana news from Jack Kubinec and Jeff Albus.


Upcoming Events

Salt Lake City, UT

MON - TUES, OCT. 7 - 8, 2023

Blockworks and Bankless in collaboration with buidlbox are excited to announce the second installment of the Permissionless Hackathon – taking place October 7-8 in Salt Lake City, Utah. We’ve partnered with buidlbox to bring together the brightest minds in crypto for […]

Salt Lake City, UT

WED - FRI, OCTOBER 9 - 11, 2024

Pack your bags, anon — we’re heading west! Join us in the beautiful Salt Lake City for the third installment of Permissionless. Come for the alpha, stay for the fresh air. Permissionless III promises unforgettable panels, killer networking opportunities, and mountains […]

recent research

Unlocked by Template.png


With the spot ETH ETF approval, the institutions are coming. stETH - given its dominance in marketshare, existing liquid market structures, and highly desirable properties - is poised for institutions.


The distributed cell plan provider started selling its own hotspots in October 2023


The Brazil-based asset manager’s filing comes during a year of milestone bitcoin and ether fund approvals


The purchase of five sites in Georgia set to help CleanSpark hit its mid-year operating hash rate target of 20 EH/s


Plus, it’s beginning to look like we may be in for a cruel summer



Engaging with XDC provides access to cutting-edge financial tools and places investors at the forefront of the trade finance revolution


Plus, an update on spot ETH ETFs and what’s on this week’s economic calendar