A new report from Bernstein reveals a significant shift in the Bitcoin BTC/USD mining landscape, with just twelve companies now controlling a substantial 30% of the network’s total hash rate.
This represents a notable increase from 22% in January 2024, highlighting a growing concentration of power within the sector.
What Happened: The report identifies these key players as being comprised of large-scale consolidators, hybrid AI-Bitcoin operations, and smaller mid-sized miners, all contributing to the sector’s rapid evolution.
The most significant hash rate growth has been led by major players including Marathon Digital MARA, Riot Platforms RIOT and CleanSpark CLSK.
Marathon Digital has reached 53 exahashes per second (EH/s) by December, representing 7% of the network’s total hash rate.
CleanSpark experienced an impressive 400% year-over-year increase and now holds 5%, surpassing Riot Platforms.
Riot, while expanding its hash rate capacity through various development projects, remains a dominant force through continued acquisitions.
Simultaneously, a number of miners, such as Iris Energy IREN and TeraWulf WULF, have begun to strategically diversify their operations, directing energy towards AI-focused data centers in addition to Bitcoin mining.
Iris Energy, which achieved a 450% hash rate growth in 2024, is also expanding its GPU infrastructure for AI-related workloads.
This highlights an industry trend towards becoming versatile data center operators, blending cryptocurrency and artificial intelligence resources.
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Why It Matters: Bernstein’s analysis further identifies key leaders in operational efficiency.
Iris Energy, Marathon Digital, and CleanSpark are noted for their strong energy utilization and operational uptime.
Iris Energy notably achieved a 90% realization rate in December, maximizing Bitcoin output per megawatt through both strategic hardware upgrades and optimized operational procedures.
There exists a distinction in financial and Bitcoin holding strategies amongst the companies.
Major consolidators, like Marathon and Riot, are holding large reserves of Bitcoin, mirroring a MicroStrategy MSTR–inspired approach, whilst raising capital through instruments like convertible bonds.
For example, Marathon holds approximately 44,890 BTC, valued at $4.5 billion, constituting around 70% of its overall market capitalization.
However, in contrast, many AI-focused miners have liquidated most of their Bitcoin production, due to internal operating policies and debt obligations.
Despite the sector’s considerable growth, with approximately 6.5 gigawatts of power currently in operation, mining companies are currently trading at a steep 90% discount compared to traditional data centers, according to Bernstein.
The report suggests a significant potential for re-evaluation, especially for operators who are exploring strategic options like AI-driven applications and advanced power management strategies.
This indicates an untapped potential for significant re-rating within the market.
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