Bitcoin is trading near 126,000 dollars. The network hashrate just touched a staggering 1.15 zetahash per second. On paper, miners should be celebrating a golden era of profitability. However, the internal math of the largest data center operators tells a different story. In the 48 hours leading up to October 26, 2025, a massive reallocation of energy capital has signaled that the traditional mining model is being cannibalized by the insatiable demand for high-performance computing.
The Revenue Gap Per Megawatt
Power is the only currency that matters in 2025. While Bitcoin mining remains profitable with a 126,000 dollar spot price, its revenue efficiency is being dwarfed by artificial intelligence. Recent industry data indicates that a single megawatt of power dedicated to Bitcoin mining generates approximately 85 dollars per hour in revenue. In contrast, that same megawatt repurposed for AI and high-performance computing (HPC) hosting generates upwards of 300 dollars per hour. This 3.5x revenue multiplier is the primary driver behind the massive infrastructure pivots seen this month.
Core Scientific and the Multi Billion Dollar Commitment
Core Scientific, trading under the ticker CORZ, has emerged as the vanguard of this transition. As of the market close on October 24, 2025, CORZ shares settled at 19.34 dollars, reflecting a significant premium for its power pipeline. The company has moved aggressively beyond its post bankruptcy mining roots, securing massive contracts with firms like CoreWeave to retrofit existing facilities for GPU density. According to Core Scientific SEC filings, the firm is now managing a power pipeline exceeding 1.2 gigawatts, with a growing percentage of that load transitioning from SHA-256 ASICs to NVIDIA B200 and H100 clusters. This is not a speculative move, it is a structural hedge against mining difficulty, which hit a record 155.98 trillion hashes this week.
TeraWulf and the Lake Mariner Expansion
TeraWulf has redefined the financing model for this hybrid shift. On October 16, 2025, the company announced a 3.2 billion dollar offering in senior secured notes to fund the expansion of its Lake Mariner facility in Western New York. This facility is no longer just a crypto mine; it is being marketed as one of the largest HPC campuses in the United States. With strategic backing from Google, TeraWulf is leveraging its zero carbon power supply to attract institutional AI workloads. Per recent TeraWulf (WULF) performance data, the market is currently valuing the firm not as a commodity producer, but as a critical infrastructure provider with a contracted revenue potential reaching 16 billion dollars over the next decade.
Iris Energy and the 50 Exahash Threshold
Iris Energy, now rebranded simply as IREN, represents the aggressive scaling side of the industry. While the company is targeting a total mining capacity of 50 exahashes per second by the end of this year, its AI Cloud division has seen 168 percent revenue growth in the last fiscal reporting period. IREN currently operates approximately 23,000 GPUs, generating an annualized revenue run rate of 500 million dollars from AI services alone. This dual engine growth allows IREN to maintain a hardware profit margin of nearly 66 percent even as global mining difficulty squeezes pure play operators. The Childress site in Texas is now undergoing a phase 4 expansion specifically designed to accommodate the higher cooling requirements of liquid cooled AI racks.
The Technical Mechanism of the Pivot
Transitioning from Bitcoin mining to AI hosting is not as simple as swapping machines. Bitcoin mining utilizes application specific integrated circuits (ASICs) which are air cooled and designed for high tolerance of environmental fluctuation. AI workloads require Tier 3 data center standards, featuring N+1 redundancy in power and cooling, as well as ultra low latency fiber interconnects. Miners are retrofitting their warehouses with liquid to chip cooling systems to handle the heat density of NVIDIA Blackwell architectures, which can exceed 100 kilowatts per rack. This capital expenditure is intensive, often costing between 5 million and 8 million dollars per megawatt to convert, but the long term contracts offered by AI firms provide a stability that the volatile Bitcoin block reward cannot match.
| Ticker | Market Cap (Billions) | AI Capacity (MW) | Hash Rate (EH/s) | Power Pipeline (GW) |
|---|---|---|---|---|
| CORZ | 4.96 | 200 | 25.0 | 1.2 |
| IREN | 3.80 | 100 | 50.0 | 2.1 |
| WULF | 2.45 | 72.5 | 8.2 | 2.0 |
Market analysts at Bloomberg have noted that the 2025 energy crunch has made existing power purchase agreements (PPAs) more valuable than the hardware they power. Bitcoin miners who secured 10 year contracts at 3 to 4 cents per kilowatt hour are now essentially arbitrageurs of energy. By redirecting that cheap power to AI, they are capturing the spread between the low cost of electricity and the high value of finished compute cycles. The market crash in late October served as a stress test for this thesis, while Bitcoin price volatility shook out smaller miners, the diversified HPC operators saw their valuations remain resilient due to their locked in AI service contracts.
Watch the April 2026 Grid Milestone
The next critical data point for the sector arrives in April 2026. This is the scheduled energization date for IREN’s 1.4 gigawatt substation expansion and the expected delivery of TeraWulf’s CB-5 facility. These projects will determine if the time arbitrage of repurposing mining sites can truly compete with the hyperscale data centers being built by Microsoft and Amazon. Investors should monitor the quarterly capital expenditure reports for these firms; any significant delay in substation energization will signal a breakdown in the execution of the AI pivot. The era of the pure play miner is closing, replaced by a new class of energy infrastructure giants.
