Bernstein said that it remains overweight on the Bitcoin mining sector, citing the growing partnerships between Bitcoin mining companies that are necessary to address the power constraints of artificial intelligence (AI) data centers.
The investment manager’s Bitcoin mining industry deal tracker registered a new AI-related deal every week in July, with combined deals standing at more than 7.5 gigawatts or the contracted equivalent of $150 billion in multi-year contracts, according to a Thursday research note shared with Cointelegraph.
The analysts said that third-party computing capacity from Bitcoin miners will remain highly valuable as access to power remains the AI industry’s real bottleneck amid growing political pushback against building new US data centers.
Bitcoin mining stocks logged double-digit gains on Monday after Bitcoin mining companies Hut 8 and IREN announced major AI infrastructure deals. Hut 8 announced a 15-year, $9.8 billion lease for its AI data center campus and IREN disclosed $2.8 billion in cloud services contracts with AI developers.
“IREN is beginning to convert that infrastructure advantage into contracted and more predictable revenue,” said Seeking Alpha contributor The Curious Analyst on Thursday. “The biggest risk to my thesis is execution,” they said. The contributor rates IREN a strong buy.
July sees slew of AI-miner tie-ups
Other publicly traded Bitcoin mining companies have also expanded into AI. Earlier in July, MARA Holdings announced plans to acquire a Texas site with up to 2 gigawatts of capacity to expand its AI and digital infrastructure business.
Days earlier, TeraWulf signed a 20-year data center lease with AI startup Anthropic, a deal the company said could generate roughly $19 billion in contract revenue.
Bitcoin mining infrastructure company Bitdeer has also expanded into AI cloud services and high-performance computing.
Most of the miner stocks were poised for gains on Thursday, based on premarket activity. HUT 8’s shares were up 5.23%, IREN was up 1.89% and TeraWulf was up 1.49%. Sector tracking exchange-traded fund CoinShares Bitcoin Mining ETF (WGMI) was up 1.47% ahead of the Nasdaq open. Bernstein has an outperform rating on all of the stocks it named, except for MARA, which it rates as market perform.
Related: Foundry asks Bitcoin miners to vote on BIP-110 support
AI data centers face political pushback
Bernstein’s research note said that Bitcoin miners and third-party computing power providers will remain important for AI companies, as the construction of new data centers is facing growing bipartisan political pushback.
On Wednesday, Texas Democratic Senate candidate James Talarico reportedly shared a proposal to create stronger local approval processes and to repeal tax breaks for AI data centers.
In April, US Senator Ron Wyden shared concerns that AI data centers in his home state of Oregon could worsen water scarcity during persistent droughts. He said that large data centers can consume up to 5 million gallons of water per day and asked large data center operators to explain how they would reduce groundwater withdrawals to protect the local water supply.
In March, President Donald Trump’s administration published a Ratepayer Protection Pledge aiming to expand AI infrastructure without increasing electricity bills for households and small businesses.
In January, several state governors published plans to expand the grid to meet the rapidly growing demand from AI data centers, but stated that new data centers should bear the costs they create, rather than shifting these to existing residential customers and small businesses.
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