Mining companies' AI transformation is 100 times the premium, and the capital game behind BTC's computing power plummeting 21%

According to Woofun AI, the cryptocurrency industry is undergoing a profound logical restructuring of capital allocation. The strategic shift from BTC mining to the field of artificial intelligence and high-performance computing power is regarded as one of the best decisions of this decade.

This trend is particularly prominent in the context of the current bear market. The price of the largest cryptocurrency plummeted by 45% in eight months, directly reducing the profit margins of mining companies and forcing the industry to re-examine the value anchors of its core assets.

The underlying reason is that these two seemingly disparate fields are quite similar at the bottom of the technology: they all need to obtain energy supplies at low prices to maintain the operation of huge computing facilities, while relying on the most efficient equipment and trying to reduce downtime. However, as demand for artificial intelligence grew exponentially while demand for Bitcoin declined at the same time, market performance was sharply divided. Early changers such as TerraWULF (WULF) (WULF), IREN (IREN.US) (IREN), and Cipher Digital (CIFR.US) (CIFR) have all increased by more than 100% in the past year, while shares of the sluggish MARA Holdings (MARA.US) (MARA) (MARA) fell 40% over the same period.

According to data compiled by Woofun AI, this differentiation is directly reflected in the collapse of computing power prices: in July of last year, the corresponding price of computing power for 10 million hashes was 63 US dollars, but now it has dropped to about 31.80 US dollars/second, causing a large number of mining companies to choose to shut down their equipment because they think it is unprofitable to continue operating.

The more critical variable is the revaluation of infrastructure due to the reshuffle of the industry. The computing power of the Bitcoin network has dropped from 1.14 zetahashes per second to 900 ahashes/second, a drop of around 21%, marking the unfolding of one of the longest “capitulation cycles” in history.

At the same time, the market gives companies with contracts for AI and high-performance computing power projects up to 12.3 times as much as a value factor, while companies engaged in Bitcoin mining alone are only 5.9 times higher. The total contract value for artificial intelligence and high-performance computing power projects received by the entire industry has reached 70 billion US dollars. Among them, Riot Platforms (RIOT.US) (RIOT.US) (RIOT.US) (RIOT.US) signed a 20-year contract worth up to 9.1 billion US dollars, driving its stock price up from about $3 to $20, fully confirming that controlling scarce energy and infrastructure resources is the core value.

Despite the strong AI transformation, there are still bullish views in the traditional mining industry. CoinShares predicts that if the price of Bitcoin returns to its all-time high of $126,000, the price of computing power may rise back to around $59 per second. This potential price correction will greatly improve the profitability of the mining industry, and is expected to re-increase the appeal of companies that specialize in Bitcoin mining, bringing a new turning point to the industry.