Bitcoin mining company transitioning to AI, aiming to completely shift away from crypto mining by 2027
One of the major Bitcoin mining firms, Bitfarm, has announced a significant shift in its business strategy. The company plans to transition from cryptocurrency mining to AI data center services by 2027. While Bitfarm may not be the largest crypto mining firm in the U.S., it still operates 12 data centers dedicated to Bitcoin mining. Currently, the company possesses an impressive energy capacity of 341 megawatts (MW), allowing it to potentially deploy numerous Nvidia GB300 NVL72 server racks.
Bitfarms CEO, Ben Gagnon, shared that the company is actively pursuing its HPC/AI infrastructure development strategy with a fully funded supply chain. The plan is to convert the Washington site to support Nvidia GB300s with state-of-the-art liquid cooling. Despite the Washington site being less than 1% of the company’s total developable portfolio, the conversion to GPU-as-a-service could potentially generate more net operating income than what Bitfarm has historically achieved with Bitcoin mining.
During its third-quarter earnings call, Bitfarm reported a $46 million net loss, marking a substantial 91% year-on-year increase in losses from the previous year. The volatility of Bitcoin, despite reaching an all-time high, made it challenging for the company to rely on it consistently for operating costs. Additionally, the performance of its new T21 mining rigs fell short of expectations, resulting in a 14% reduction in its hashrate guidance for the first half of 2025.
Apart from converting the Washington data center, Bitfarm also repurposed a Macquarie debt facility worth $300 million into financing for its Panther Creek, Pennsylvania, data center. This facility, with a potential capacity of at least 350 MW, adds to Bitfarm’s 1.3-gigawatt energy pipeline, positioning the company as a significant player in the AI data center industry.
Currently, with 341 MW of energized capacity, Bitfarm does not face challenges in acquiring additional power for its data centers. This advantageous position helps the company circumvent power bottlenecks experienced by other hyperscalers, such as Microsoft, which found itself with AI GPUs sitting idle due to insufficient warm shells to connect them to.
While the pivot to AI processing presents a lucrative opportunity for growth, it also involves risks, particularly considering the speculation that the AI industry may be in a bubble. The substantial investment required to transition entirely from crypto mining to AI data centers, potentially costing hundreds of millions, if not billions, of dollars, could expose Bitfarm to financial vulnerabilities should the AI market encounter a downturn, affecting not only the company but also lending institutions and other stakeholders.
