Bitcoin Miners Ally With AI Firms as Crypto Industry Struggles to Gain Profit

Bitcoin miners have started allying with AI firms as the cryptocurrency industry finds itself struggling to gain profit following the "Bitcoin halving" earlier this year, the Financial Times reported.

After a 'Bitcoin halving' earlier this year, Texas-based Bitcoin miner Core Scientific has reportedly been "aggressively pursuing" partnerships with AI firms.

These partnerships would see the Bitcoin miners lending their data centers to help train new AI models, thanks to the hardware requirements for both cryptocurrency mining and AI models: advanced graphics card units to process high volumes of data simultaneously.

(Photo : Traxer via Unsplash)

According to the Financial Times, several other crypto miners in Texas, North Carolina, and Georgia have also struck similar deals with tech startups as the industry pivots further towards generative AI.

In some cases, the Bitcoin miners are even transitioning into AI firms themselves to recoup losses from the steeper competition in the crypto market.

While most deals are currently in the hundreds of millions of dollars, experts project that the numbers could reach billions as tech giants like Google, Amazon, and Microsoft expand their AI development.

Also Read: Bitcoin 'Halving' May Happen This Week Amid Bearish Crypto Market

Why Are Bitcoin Miners Leaning More Towards AI?

Following the bitcoin halving earlier this year, Bitcoin miners have been seeking alternative revenue streams as the incentives for mining new crypto coins continue to dwindle.

This is not to mention the increasing operating costs for electricity, hardware, and regulatory fees required.

It also didn't help that many people have left the Bitcoin business following its initial boom during the COVID-19 pandemic to find the next big thing in the tech industry.

These led to several Bitcoin companies announcing bankruptcy less than five years after opening as potential partnerships dry up and regulatory rules become stricter.

Related Article: Bitcoin Could Hit $100,00 by Year-End 2024 - Crypto Execs

Bitcoin Miners-AI Firms Partnership Could Save a Lot of Energy

If there is one definitive positive outcome from these deals, it would likely be opening the path for crypto data centers to use energy more efficiently.

Energy consumption has been one of the people's biggest concerns regarding crypto mining due to its high electricity demand to operate its data centers, a problem slowly being solved and innovated by AI firms as they expand operations.

With the bigger attention on the AI industry, crypto miners would also be forced to comply more with regulations and avoid further controversies that have plagued the industry since its inception.

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