- US technology firms are increasingly looking to secure energy assets from Bitcoin miners to power their expanding AI data center infrastructure as a report from the Electric Power Research Institute indicates data centers could consume up to 9% of the total electricity generated in the United States by 2030.
- Crypto miners see it as an opportunity to pivot to AI, however, the high cost of maintaining AI data centers is quickly becoming a significant challenge for miners.
The expansion of AI is not slowing down anytime soon, despite the quickly dwindling supply of electricity needed to power its data centers. Hence, AI leaders like Amazon, Microsoft, Google and other U.S. technology companies are now looking to tap into the power supply of crypto miners to scale their AI deployments in the coming years.
Bitcoin miners had the first-mover advantage in securing energy assets for cryptocurrency mining. But the recent craze for AI has left Big Tech scrambling for the same power and energy assets as miners. Miners view this as an opportunity to pivot to AI, while maintaining a stake in cryptocurrency mining, getting the best of both worlds.
Texas-based crypto miner Core Scientific came out of bankruptcy this year, announcing an agreement to lease its power facilities to Nvidia-backed CoreWeave for 12 years, a deal estimated to be worth $6.7 billion. Kerri Langlais, the chief strategy officer of TeraWulf, an infrastructure-focused Bitcoin mining firm, reiterated the interest from Big Tech, stating,
“We’ve gotten a lot of interest from everyone, from an Amazon or Google.”
Even the world’s largest publicly traded Bitcoin miner, Marathon Digital Holdings, stated,
“We are always willing to talk with anyone who is looking to sell a data center.”
While most crypto miners are making a profit by leasing or selling their energy-connected infrastructure, some are struggling to maintain their operations as AI businesses are eating into their power supply. The challenges in pivoting to AI include the high costs of operating AI data centers, requiring specialized cooling equipment and longer construction times.
CleanSpark’s CEO Zach Bradford announced that his company will stick to crypto mining as its core business despite interest from AI companies. He added,
“Most bitcoin miners that are out there saying they are going to do AI don’t really know what they’re getting into.”
ReadMore: Cybercrime Costs German Firms $298B in 2023 Says Bitkom
A study by the Electric Power Research Institute in May also highlighted that data centers could consume up to 9% of the total electricity generated in the United States by 2030. In comparison, crypto mining accounts for less than 0.5% of electricity consumption, a number that is expected to increase with miners outsourcing their infrastructure to AI businesses.
Conclusion
Crypto miners will need to adapt as technology companies look to secure energy for their increasingly power-hungry AI infrastructure. While some see it as an opportunity to diversify into AI, others will focus on mining as their core business due to challenges in pivoting to AI infrastructure. In the end, energy authorities will need to ensure a fair distribution of power among both industries, as miners are increasingly favoring Big Tech companies with deeper pockets than their crypto peers.
What is your reaction?
