Key Takeaways
- Matthew Sigel from VanEck highlights that Bitcoin mining operations possess essential power infrastructure that AI data centers require years to develop
- Mining companies are significantly undervalued relative to traditional data center operators when comparing market capitalization per megawatt
- MARA is transforming its mining facilities into large-scale data center operations; Core Scientific obtained financing up to $1 billion from Morgan Stanley to support its AI transformation
- The worldwide mining hash rate declined 6% since its November 2025 high, partially attributed to equipment being redirected toward AI computing tasks
- CleanSpark indicated that Bitcoin mining capital allocation no longer offers competitive returns versus AI opportunities at present hash rate economics
The cryptocurrency mining sector has developed extensive power infrastructure over recent years that artificial intelligence firms are scrambling to acquire. According to Matthew Sigel, VanEck’s head of digital asset research, Wall Street has yet to fully recognize this strategic advantage.
During an appearance on CNBC’s Squawk Box, Sigel characterized mining operations as “sitting on a gold mine” due to their existing ownership of critical assets including land rights, energy contracts, thermal management infrastructure, and established utility relationships—resources that typically require years for new facilities to obtain.
New data center operators face extensive delays when connecting to electrical grids, with interconnection backlogs extending into 2028 and later. Mining companies have already navigated these regulatory and technical hurdles.
Yet despite this competitive advantage, Sigel notes that mining stocks continue trading at substantial discounts compared to conventional data center companies when evaluated on a market capitalization per megawatt basis. Either the market hasn’t recognized the AI opportunity or remains skeptical about miners’ ability to successfully transition.
Actual performance data indicates the transformation is underway. Publicly traded mining companies are planning to expand from their current 7 gigawatts of capacity to 20 gigawatts by 2027.
Major Transactions Signal Industry Transformation
This strategic shift extends beyond mere speculation. MARA announced a February agreement to repurpose its mining locations into hyperscale data center facilities. Core Scientific obtained up to $1 billion in capital from Morgan Stanley just last week to accelerate its AI infrastructure buildout.
CleanSpark offered blunt assessment. During Q1 2026, the company stated that allocating capital to Bitcoin mining operations delivers inferior economics relative to AI infrastructure investments given current hash rate pricing.
This strategic reallocation appears in network statistics. The global mining hash rate has contracted 6% from its November 2025 peak. A portion of this decline reflects mining equipment being repurposed for AI computational work instead of Bitcoin production.
While not currently threatening Bitcoin network security, this trend merits ongoing observation.
Meanwhile, Bitdeer continues expanding its mining capabilities. The firm is installing 50,000 custom-designed ASICs across 413 megawatts of capacity, potentially contributing 33 exahashes per second to network power and generating $335 million in additional Bitcoin revenue at prevailing market rates.
Power Flexibility Becomes Revenue Stream
Beyond AI hosting capabilities, mining operations offer another valuable attribute. These facilities can rapidly reduce electricity consumption on demand. As AI infrastructure and industrial production increase strain on domestic power grids, this operational flexibility carries significant economic value.
Sigel characterized this as an effective grid management resource. When electrical grids experience peak demand, mining operations can temporarily shut down. This prevents power disruptions to other users. While miners sacrifice some revenue during these periods, this demand response capability can be monetized as a grid service.
Industry projections indicate AI data center electricity demand will expand at 24% compound annual growth through 2030.
The Q1 2026 earnings cycle will provide the first comprehensive assessment of how extensively the AI pivot has progressed. Market analysts will scrutinize power capacity metrics, AI hosting contract announcements, and curtailment service revenue.
Core Scientific secured its $1 billion Morgan Stanley financing arrangement last week.
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