Investing.com – Miners are increasingly looking to diversify into AI data centers as a means to build sustainable business models and attract institutional investors, according to a note from Bernstein on Monday.
Analysts said several major miners, such as Marathon Digital (NASDAQ:) and Core Scientific Inc (NASDAQ:), have recently raised decent funding via convertible bonds, and each company has followed its own unique approach.
Marathon Digital has raised $300 million with plans to buy more Bitcoin, following the lead of MicroStrategy, which pioneered the use of long-term convertible notes to acquire the original cryptocurrency as a corporate treasury asset.
Marathon’s notes were priced at a 25% premium and a 2.125% coupon, maturing in 2031. Meanwhile, Core Scientific raised $400 million at 3% interest over a five-year term, intending to pay down high-cost debt and acquire AI-focused data centers.
Bernstein argues that the reaction from capital markets highlights a growing divide among Bitcoin miners. Some remain committed to Bitcoin mining, while others are turning to AI data centers. The latter approach, known as the “Mullet strategy,” puts AI data centers in the spotlight while keeping Bitcoin mining running in the background.
“Should all Bitcoin miners transition to AI data centers?” the note asks, citing strong interest from institutional investors in miners adopting AI/HPC (high-performance computing) strategies.
Bernstein suggests that this shift could provide miners with a more sustainable economic model, particularly as the AI industry continues to attract large investments.
The report also noted that US-listed Bitcoin miners, with access to the world's deepest capital markets, have a natural advantage over their non-US, unlisted counterparts.
“This validates our long-standing view of publicly traded Bitcoin miners in the United States as market consolidators,” the note said.
Bernstein analysts also addressed the upcoming US elections, noting that Polymarket trends show a tight race between Trump and Harris.
Uncertainty surrounding the election keeps Bitcoin and cryptocurrency markets range-bound. Bernstein reaffirmed his view that a Republican victory, especially for Trump, would likely be seen as a positive for the cryptocurrency market.
