- Bitfarms plans to shift its Washington site to AI systems as it moves away from Bitcoin mining operations.
- Rising costs push many miners toward AI as demand grows and Bitcoin mining becomes less profitable worldwide.
- Bitfarms faces heavy quarterly losses as its stock drops sharply while it accelerates its transition to AI.
Bitfarms has begun a major shift in its business model as it prepares to convert its Bitcoin mining portfolio into AI and high-performance computing sites. The firm identified its 18-megawatt facility in Washington as the first location scheduled for full conversion. The company expects the transformation to finish by December 2026.
Executives indicated that the Washington site represents a small portion of the firm’s overall network, yet they expect the new model to generate higher net operating income than its mining operations ever delivered. The company plans to phase out its Bitcoin mining business during 2026 and 2027 as part of this strategy.
Industry Push Toward AI Compute
The shift reflects a broader movement within the sector. Several mining competitors have started directing resources toward AI computers due to rising demand. Earlier in November, mining firm IREN agreed to a multiyear deal valued at $9.7 billion to supply Microsoft with AI compute capacity. Industry analysts note that public miners currently account for a large share of the global mining network, and many now prefer the higher economics associated with high-performance computing. Moreover, British Columbia announced plans to permanently ban new crypto mining power connections to protect energy supply and support AI growth.
The miners are still under pressure due to rising difficulty in mining and escalating cost of operations. Consequently, a few operators have started to venture into cheaper markets like the Middle East, Africa and Russia. Bitfarms executives claimed that the United States is still a powerful market to develop AI, as mining of Bitcoins moves to more distant and less expensive locations across the globe.
Financial Strain Drives Transition
Bitfarms reported a net loss of $46 million for the third quarter. The figure compares with a $24 million loss during the same period last year. The firm earned 520 Bitcoin during the quarter at an average direct cost of $48,200 each. It held 1,827 Bitcoin as of Wednesday. Quarterly revenue increased 156% compared to the year ago by a figure of $69 million though this is lower than the analyst expectation.
Bitfarms stock dropped by almost 18% to $2.60 after release and dropped even more in the after-hours trade. Its stock has reduced by a margin of over 51% in the past one month. The firm operates 12 data centers across North America with a combined energy capacity of 341 megawatts. It recently restructured a $300 million debt facility to support development of a new site in Pennsylvania aimed at future AI needs.
Broader Market Conditions Add Pressure
Bitcoin prices have also weakened. The cryptocurrency fell nearly 3% in the last 24 hours and dropped to its lowest level in six months earlier on Thursday. The broader downturn has added additional pressure on miners already facing rising energy costs and reduced margins.
