Bitcoin Miners Are Fleeing to AI: So Why Is the Hash Rate Surging? - CryptoPotato

Bitcoin miners are increasingly redirecting power toward the artificial intelligence sector, with five major listed operators cutting their Bitcoin production by 47% this year.

IREN secured a $9.7 billion contract with Microsoft and plans to decommission its mining fleet by year-end, while Core Scientific leased power to CoreWeave and AMD.

Hash Rate Rebounds

Despite the exodus, the Bitcoin network’s hash rate has surged back from its summer lows, climbing 11.7% in recent months to within 9% of its all-time high.

The metric had dropped by over 18% to under 900 EH/s on August 6, its deepest drawdown since the 2021 Chinese mining ban, but has since recovered more than half of that loss in the first three weeks of October.

CryptoQuant attributes the rebound to new-generation machines operated by private miners, sovereign-backed operations, and non-US companies, which have added 105 EH/s since the August low.

Miners who remained in Bitcoin, such as MARA, CleanSpark, Riot, HIVE, and American Bitcoin, increased combined output by 16% year-over-year, offsetting some losses from their AI-transitioning peers.

Miner Conditions Improve

The recovery in Bitcoin’s price from under $60,000 to over $80,000 has also improved miner conditions, reducing the pressure to sell Bitcoin to cover expenses.

Miner revenues have rebounded sharply, and extreme outflows have disappeared, signaling a stabilization in the ecosystem as the network adapts to the shifting landscape.