The rise of artificial intelligence (AI) data centers may unexpectedly benefit bitcoin mining operations, even those that don’t directly work with AI technologies.
The reason behind this is the growing competition between AI data centers and bitcoin miners for affordable electricity. This rivalry could help stabilize hashprice, a key metric that bitcoin miners use to estimate their earnings based on the network’s total computational power.
“Now, every decision about where to locate a mining operation involves this question: Is it better to allocate this power for AI use or for bitcoin mining?” explained Spencer Marr, president of bitcoin mining firm Sangha Renewables. “When AI takes over a power source, it means that less electricity is available for mining, which could help stabilize hashprice and prevent it from falling too quickly.”
Hashrate refers to the overall computing power that supports the Bitcoin network, while hashprice is the amount of bitcoin a miner can earn for performing a certain amount of computations on the network within a set time frame.
Currently, Bitcoin’s hashrate is around 770 exahash per second (EH/s), according to Hashrate Index data. The current hashprice is approximately $61.12 per petahash per day, showing a decline from previous years when it could surpass $1,000.
Having a floor for hashprice would be valuable for miners, as it would ensure that their mining operations retain a certain level of profitability, even if market conditions turn less favorable.
“In this race for cheap electricity, AI data centers are competing for the same resources as miners, which could make the demand for electricity more consistent,” Marr noted. “This competition might end up stabilizing hashprice, preventing it from declining further.”
However, Jaran Mellerud, co-founder of Hashlabs Mining, believes the impact of AI’s electricity demands on bitcoin mining will be limited. He argues that miners will simply shift to regions where AI facilities aren’t driving up electricity prices.
“I don’t think the competition for cheap power will significantly hurt hashprice,” Mellerud said. “Bitcoin mining has a self-regulating mechanism, meaning reduced mining capacity in one area will result in greater profitability for miners in other regions.”
Mellerud predicts that by 2030, the U.S. will have less than 20% of the global bitcoin hashrate due to the rise of AI data centers, while other regions, particularly in Africa and Southeast Asia, will see mining activity increase.
While Marr acknowledges Mellerud’s point, he emphasizes that the global supply of cheap electricity is limited. He also points out that AI data centers are more complex and expensive to maintain compared to bitcoin mining operations, requiring more consistent uptime and heavier infrastructure investments.
“At the end of the day, competition for low-cost electricity might slow the growth of hashrate, but it won’t stop it,” Marr concluded.
