Jackson Hole, Wy. -Bitcoin mine workers have long been defined by the boom-and-bust rhythm of the four-year half-life cycle. But the game has now changed, according to some of the industry’s most prominent leaders at the SALT conference in Jackson Hole earlier this week.
The increase in exchange -traded funds, increasing demand for power and the prospect of artificial intelligence (AI) Reforming infrastructure needs means that miners must find ways to diversify or risk being left behind.
“We used to come here and talk about hash frequency,” said Matt Schultz, CEO of Cleanspark. “Now we’re talking about how to make money on megawatts.”
For years, mining companies-as derived their main source of income, are held solely from mining Bitcoin and died of the four-year-old Bitcoin twig cycle. Each cycle, rewards were cut in half, and miners shrinked to reduce costs or scale up to survive. But the rhythm, according to these leaders, no longer defines the company.
“The four -year cycle is effectively broken with the maturation of Bitcoin as a strategic asset, with ETF and now the strategic treasury and what not,” Schultz said. “Adoption drives demand. If you read something about the latest ETF, they have devoured infinitely more bitcoin than have been generated so far this year.”
Cleanspark, which now operates 800 Megawatt Energy Infrastructure and has an additional 1.2 gigawatts in development, has begun to turn its attention beyond Proof-of-Work. “Our speed in the market with electricity has created opportunities so that we can now look at ways to make money on the flow beyond just Bitcoin mining,” he said. “With 33 locations we now have much more flexibility than we have ever done before.”
A brutal business
Schultz is not alone in calling the industry’s monumental shift in business model.
Patrick Fleury, CFO for Terawulf, repeated the mood and did not try to the sugar coat, as the profits that miners now feel.
“Bitcoin mining is an incredibly difficult business,” he said. He broke down the economy of Bitcoin mining in straightforward terms: with electricity priced at five cents per year. Kilowattime, it currently costs about $ 60,000 to take advantage of a single bitcoin. At a Bitcoin price of $ 115,000, this means half of the revenue is consumed by power alone. When business expenses and other operating costs are incorporated, the margins are tightened quickly. In his view, the profitability of mining is almost exclusively on ensuring ultra-low cost effect.
For Fleury, the deeper problem is not just power costs – it is the relentless expansion of the network itself, driven by hardware manufacturers with a little incentive to slow down.
He pointed to Bitmain, who continues to produce mining, regardless of the market’s demand thanks to its direct pipeline to chipmakers as TSMC. Even when miners are not buying, the company can implement the actual machines in regions with ultra-cheap electricity-from the US to Pakistan-flooding the network with hashraft and increases mining difficulty. This global footprint, combined with low production costs, allows Bitmain to remain profitable while pressing the margins for everyone else.
Still turning terawulf aggressively. Last week, it signed a rental home of $ 6.7 billion with Google to convert hundreds of megawatts with mining infrastructure to data center.
“These things that everyone can testify to up here, as an electrical infrastructure, should not move quickly,” Fleury said. “Tech is used to moving fast and breaking things, but these offers take an extremely long time to get together. It took us four to five months with very intense pigeon diligence.”
“What I am most proud of in this transaction really worked collectively with these partners to come up with a new mousetrap, which I hope now becomes something that the industry can duplicate with other companies,” he said. “Google delivers $ 3.2 billion backstop leasing obligation to terawulf, which effectively allows me to go out and secure funding at a truly effective capital cost.”
Profitability – or patience
Kent Draper, Chief Commercial Officer at Iren, took a quieter but confident attitude. His company Mines Bitcoin with profit – even today, he said. Still he pointed to a common denominator: Power.
“Being a cheap manufacturer is fundamentally important, and that’s how we have always focused our business-to have control over our sites, have operational control, to be in areas that are cheap jurisdictions,” Draper said.
According to him, IREN is currently operating on 50 Exahash, which translates into an annual dollars of annual revenue driving under the current Bitcoin market conditions. He noted that the company’s gross margins – revenue minus electricity costs – stand at 75%, and even after explaining the overhead and SG&A expenses of the companies, IREN maintains a 65% EBITDA margin or approx. $ 650 million in annual earnings.
Still pausing IREN’s expansion in mining. “It’s really dictated just by the opportunity set that we see on the AI page today, and the potential to really diversify revenue streams within our business rather than a basic view that Bitcoin mining is no longer attractive,” Draper said.
On the AI side, Iren is pursuing both co-location and cloud. “Capital intensity is very different,” Draper said. “If you own the GPUs at the top of the data center infrastructure, it is 3x investment. On the flushing side, the repayment periods have a tendency to be much faster – typically about two years on the GPU investment alone.”
Keeps Bitcoin – and the line
For Marathon Digital (Mara) CFO Salman Khan, survival is about agility. With decades in the oil industry, Khan sees a well -known pattern: boom, bust, consolidation and the constant run to remain effective.
“This reminds me of these trends in commodity -exposed cycle industries,” Khan said. “There are some very wealthy families in the oil sector who have earned billions, and then there are others who have filed for bankruptcies. You must have a strong balance to survive these bikes.”
Marathon keeps Bitcoin on his balance – something Khan said paid off. “We are not a Treasury company, we are not strategy, but we like to have that hedge if Bitcoin Price escalates.”
Recently, marathon announced a majority share in exaion. “The angle we have on the AI front is calculated on the edge,” Khan said. “We like SOVEREIGN COMPLETS, which allows people to control their data better in a closer place to them. We like the aspect of recurring revenue that comes with it. We also like that there is a software -aspect about it, and also the platform aspect for it.”
In addition to Bitcoin behind the grid
Despite the different views and strategies, it all comes down to a common factor: Power. Whether it was used to my bitcoin, power AI or balance electric grids, energy – not hash frequency – the currency of the conversation was.
“We limit our energy consumption for 120 hours a year,” said Cleansparks Schultz. “We can avoid a third of our total energy costs. So that’s the flexible load.”
Cleanspark, he added, has spent the last year quietly locking megawatts around the country. “You mentioned Georgia,” Schultz said. “We have 100 megawatts around Atlanta Airport. It’s a good example. We’ve been focused on being the valuable partner for some of these rural areas to make money on stranded megawatts.”
Still about Bitcoin – so far
Despite the growing focus on AI, the panelists made it clear that Bitcoin remains central to their business – so far. When asked why mining companies still deserve investor attention, the answers to scale, cost -effectiveness and the ability to weather volatility pointed out.
Fleury emphasized that Terawulf’s contracted power capacity could generate a significant cash flow and compare the economy with established data center operators. Khan pointed out an interruption between Marathon’s Bitcoin Holdings and its market assessment, which suggested that core development is overlooked. Draper emphasized the Irish operational efficiency and cheap footprints with reference to recent performance metrics that placed the company in front of other public miners.
And while the future may include Sky Infrastructure and Kant Compute, Schultz claimed that Bitcoin himself could still develop into something greater – a basic layer of energy systems. As he put it, the next phase may not be about speculation, but about Bitcoin’s role in helping balance power networks.
Read more: Bitcoin -mining Soar, Da HashRate Hits Records: TheminerMAG
