Bitcoin

Jackson Hole, Wy. — Bitcoin miners have long been defined by the boom-and-bust rhythm of the four-year halving cycle. But the game has now changed, according to some of the industry’s most prominent executives at the SALT conference in Jackson Hole earlier this week.

The rise of exchange-traded funds, surging demand for power, and the prospect of artificial intelligence (AI) reshaping infrastructure needs mean that miners must find ways to diversify or risk being left behind.

“We used to come here and talk about hash rate,” said Matt Schultz, CEO of Cleanspark. “Now we’re talking about how to monetize megawatts.”

For years, mining companies—which derived their main source of revenue solely from mining bitcoin—lived and died by the four-year bitcoin halving cycle. Every cycle, rewards were slashed in half, and miners scrambled to cut costs or scale up to survive. But that rhythm, according to these executives, no longer defines the business.

“The four-year cycle is effectively broken with the maturation of bitcoin as a strategic asset, with the ETF and now the strategic treasury and whatnot,” Schultz said. “The adoption is driving demand. If you read anything about the most recent ETF, they’ve consumed infinitely more bitcoin than have been generated so far this year.”

Cleanspark, which now operates 800 megawatts of energy infrastructure and has another 1.2 gigawatts in development, has begun turning its attention beyond proof-of-work. “Our speed to market with the electricity has created opportunities such that now we can look at ways to monetize power beyond just bitcoin mining,” he said. “With 33 locations, we now have a great deal more flexibility than we ever did before.”

A brutal business

Schultz is not alone in calling the industry’s monumental shift in business model.

Patrick Fleury, CFO of Terawulf, echoed the sentiment and didn’t try to sugarcoat the profit squeeze the miners are now feeling.

“Bitcoin mining is an incredibly difficult business,” he said. He broke down the economics of bitcoin mining in straightforward terms: with electricity priced at five cents per kilowatt hour, it currently costs around $60,000 to mine a single bitcoin. At a bitcoin price of $115,000, that means half the revenue is consumed by power alone. Once corporate expenses and other operating costs are factored in, the margins tighten quickly. In his view, profitability in mining hinges almost entirely on securing ultra-low-cost power.

For Fleury, the deeper problem isn’t just power costs — it’s the relentless expansion of the network itself, driven by hardware manufacturers with little incentive to slow down.

He pointed to Bitmain, which continues to produce mining rigs regardless of market demand, thanks to its direct pipeline to chipmakers like TSMC. Even when miners aren’t buying, the company can deploy the machines itself in regions with ultra-cheap electricity — from the U.S. to Pakistan — flooding the network with hash power and driving up mining difficulty. That global footprint, coupled with low production costs, allows Bitmain to remain profitable while squeezing margins for everyone else.

Still, Terawulf is pivoting aggressively. Last week, it signed a $6.7 billion lease-backed deal with Google to convert hundreds of megawatts of mining infrastructure into data center space.

“These things, as everyone can attest to up here, like electrical infrastructure, don’t move quickly,” Fleury said. “Tech is used to moving quickly and breaking things, but these deals take an extremely long time to come together. It took us four to five months of very intense due diligence.”

“What I take the most pride in in that transaction was really working collectively with those partners to come up with a new mousetrap that I hope now becomes something that the industry can duplicate at other companies,” he said. “Google is providing $3.2 billion of backstop lease obligation support to Terawulf, which effectively allows me to go out and secure financing at a really efficient cost of capital.”

Profitability—or Patience

Kent Draper, chief commercial officer at IREN, took a quieter but confident stance. His company mines bitcoin profitably — even today, he said. Still, he pointed to one common denominator: power.

“Being a low-cost producer is fundamentally important, and that’s how we’ve always focused our business — having control of our sites, having operational control, being in areas that are low-cost power jurisdictions,” Draper said.

Iren, according to him, is currently operating at 50 exahash, which translates to a billion-dollar annual revenue run rate under current bitcoin market conditions. He noted that the company’s gross margins — revenue minus electricity costs — stand at 75%, and even after accounting for corporate overhead and SG&A expenses, IREN maintains a 65% EBITDA margin, or roughly $650 million in annualized earnings.

Still, even IREN is pausing its expansion in mining. “That’s really dictated just by the opportunity set that we see on the AI side today and the potential to really diversify the revenue streams within our business, rather than a fundamental view that bitcoin mining is no longer attractive,” Draper said.

On the AI side, IREN is pursuing both co-location and cloud. “Capital intensity is very different,” Draper said. “If you’re owning the GPUs on top of the data center infrastructure, that’s 3x the investment. On the cloud side, the payback periods tend to be a lot faster—typically around two years on the GPU investment alone.”

Holding bitcoin — and the Line

For Marathon Digital (MARA) CFO Salman Khan, survival is about agility. With decades in the oil industry, Khan sees a familiar pattern: boom, bust, consolidation, and the constant race to stay efficient.

“This reminds me of those trends in commodity-exposed cycle industries,” Khan said. “There are some very wealthy families in the oil sector who made billions, and then there are others who have filed bankruptcies. You have to have a strong balance sheet to survive these cycles.”

Marathon holds bitcoin on its balance sheet — something Khan said paid off. “We’re not a treasury company, we’re not Strategy, but we like to have that hedge if bitcoin price escalates.”

More recently, Marathon announced a majority stake in Exaion. “The angle that we have on the AI front is compute on the edge,” Khan said. “We like sovereign compute, which allows people to control their data better at a closer location to them. We like the aspect of recurring revenues that come with that. We also like that there’s a software aspect to it, and also the platform aspect to it.”

Beyond bitcoin, behind the grid

Despite the different points of view and strategies, it all comes down to one common factor: power. Whether it was being used to mine bitcoin, power AI, or balance electrical grids, energy — not hash rate — was the currency of the conversation.

“We curtail our energy consumption for 120 hours a year,” CleanSpark’s Schultz said. “We can avoid about a third of our total energy costs. So being that flexible load matters.”

Cleanspark, he added, has spent the past year quietly locking up megawatts around the country. “You mentioned Georgia,” Schultz said. “We have 100 megawatts surrounding the Atlanta airport. That’s a prime example. We’ve been focused on being the valuable partner for some of these rural utilities to monetize stranded megawatts.”

Still about bitcoin — for now

Despite the growing focus on AI, the panelists made it clear that bitcoin remains central to their businesses — for now. When asked why mining companies still deserve investor attention, the answers pointed to scale, cost efficiency, and the ability to weather volatility.

Fleury emphasized that Terawulf’s contracted power capacity could generate substantial cash flow, comparing the economics to established data center operators. Khan pointed out a disconnect between Marathon’s bitcoin holdings and its market valuation, suggesting that the core mining business is being overlooked. Draper underscored IREN’s operational efficiency and low-cost footprint, citing recent performance metrics that placed the company ahead of other public miners.

And while the future may include cloud infrastructure and edge compute, Schultz argued that bitcoin itself could still evolve into something larger — a foundational layer for energy systems. As he put it, the next phase may not be about speculation, but about bitcoin’s role in helping balance power networks.

Read more: Bitcoin Mining Costs Soar as Hashrate Hits Records: TheMinerMag

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