Bitcoin’s halving is coming. Miners are looking for new ways to make money.



Crypto-industry companies turn to artificial intelligence to diversify.

Companies that unlock new bitcoins are revamping their businesses to depend less on the cryptocurrency ahead of a supply contraction that will cut profits in half.

The crypto industry is holding its breath for an event called the halving, an adjustment to the bitcoin blockchain that cuts in half the number of bitcoins that can be unlocked by miners. The change, which takes place every four years, will halve the number of bitcoins released on average every 10 minutes to 3.125 from 6.25 on or around April 19.

Bitcoin bulls are excited because the event further constrains the cryptocurrency’s supply, while demand has ramped up thanks to a new class of exchange-traded funds holding the token. Bitcoin’s supply was capped at 21 million by its pseudonymous creator Satoshi Nakamoto, and more than 90% have already been released. Crypto traders believe this event will drive bitcoin’s price higher over time.

Strong demand for bitcoin ETFs has propelled the token’s price to new highs in recent weeks. That, in turn, has boosted how much money bitcoin miners are making from fresh tokens to more than $70 million a day. How that fares in the future is less certain.

Despite the rally in bitcoin, the miners’ stock prices are down sharply this year on worries about the halving.

If bitcoin’s price rises strongly as new supply curtails, it could soften the financial blow. If it doesn’t, it could challenge the survival of some miners. Bitcoin’s short history has been dotted with wild surges and devastating crashes. So far, each bust has been followed by another boom cycle that attracted more investors.

Some miners are looking for opportunities to sell their technology to artificial-intelligence companies, while others are exploring ways to snap up smaller rivals and older computers at a discount.

“We’re very much diversifying the business, the goal being to have a business with multiple revenue streams that can operate no matter what the economic weather is," said Fred Thiel, chief executive of Nasdaq-listed bitcoin miner Marathon Digital Holdings.

To unlock new bitcoins, companies host an array of computers that generate random numbers in hopes of finding the right combination to unlock the next tranche of bitcoin. The first computer to do so is rewarded with newly released bitcoins. This creates two major costs for companies: data centers to store the machines and electricity to power them.

To reduce costs and find new revenue streams, Marathon Digital Holdings has been buying up facilities that host its computers in Nebraska and Texas rather than paying third parties for the same services, according to Thiel. It also gives Marathon the ability to sell unused energy back to the grid in Texas if harvesting bitcoins is less profitable on a given day or time.

Marathon is also looking to sell technology it has created to keep bitcoin-mining computers from overheating to artificial-intelligence companies that will likewise have to host suites of computers to run models.

Shares of Marathon have lost more than a third of their value this year, to $14.60. During crypto’s last peak in late 2021, the stock traded above $75 a share. Marathon and other miners were hit hard during the crypto winter that followed when high energy prices and falling bitcoin prices squeezed their bottom lines. Marathon’s business started picking back up again last year: The company swung to a $261 million profit, and revenue more than tripled.

Competitor Bit Digital bought Nvidia H100 computers and has started diversifying by renting out the ability to use the computers to clients, Chief Executive Samir Tabar said. The firm has a $150 million AI contract with one client for three years and is working to add more, he added.

“There’s just no halving in AI," Tabar said. “If bitcoin does not go up [in value], we have this AI business."

Bit Digital shares have lost 57% of their value this year, to $1.82—they traded above $25 at their peak in early 2021.

Analysts say they expected price volatility and weakness in mining stocks ahead of the halving because not all miners will survive.

“As for pivoting to other revenue sources, I personally don’t think it’s as easy as people are letting on," said Joe Flynn, an analyst at Compass Point Research & Trading.

Some miners have tried to upgrade their data centers for other companies to use, but that requires significant capital expenditure. Miners that already have significant power assets are in a better position because they can be valuable in the long run, Flynn added.

The outlook could be especially murky for smaller miners that aren’t well-capitalized. Small and midsize miners often have higher operational costs than their larger counterparts because they aren’t in a position to negotiate contracts with electricity and data-center providers. Many of them are also relying on mining machines that could soon need upgrading after the halving intensifies the competition to retrieve new bitcoins.

“Three to six months post-halving, that’s when you’re going to start to see companies that weren’t able to refresh their machines and companies that didn’t put enough cash on the balance sheet start to falter," said Adam Sullivan, chief executive of Core Scientific.

Core Scientific, which relisted on the Nasdaq after exiting bankruptcy earlier this year, has been selling its bitcoins regularly to generate cash for opportunities that could arise from the halving, Sullivan said. The company is looking to snap up new mining machines and smaller firms at a discount after the halving, he said.

Write to Caitlin Ostroff at and Vicky Ge Huang at


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