These Bitcoin miners are preparing to take advantage of potential AI profits

• More and more crypto mining companies are diversifying into AI.

• This transition could create excellent buying opportunities in publicly listed Bitcoin mining stocks.

• In this article, we’ll take a look at the stocks that could be put to benefit the most from this pivot.

• Looking for actionable trading ideas to navigate the current market volatility? Unlock access to InvestingPro’s AI-picked stock winners for less than $9 per month!

The cryptocurrency mining sector is undergoing a major transformation, with Bitcoin miners increasingly diversifying into the artificial intelligence (AI) and high-performance computing (HPC) sectors.

Facing increasing pressures such as rising energy costs, regulatory scrutiny and market volatility, mining companies are exploring new revenue streams to sustain and grow their businesses.

Bitcoin mining has always been an energy-intensive process, requiring considerable computing power to solve complex mathematical problems.

Rising energy prices and heightened environmental concerns have put miners in the spotlight. Additionally, cryptocurrency volatility adds a new layer of financial uncertainty, making profitability a moving target.

Regulators around the world are also tightening their grip on cryptocurrency activities.

Stricter compliance requirements and potential legal hurdles make the mining landscape even more challenging. The combination of these factors has caused miners to reevaluate their business models.

The transition to AI is radically changing the outlook for crypto-mining companies

Artificial intelligence and machine learning applications require significant computing resources, as does cryptocurrency mining.

Recognizing this, many mining companies are reallocating their existing infrastructure to AI. This pivot allows them to use their high-performance hardware for tasks such as data analysis, natural language processing and image recognition.

In other words, crypto mining stocks, once approached primarily as a proxy for investing in digital assets through the stock market, are completely changing their profile.

Some crypto mining companies are indeed poised to become vital links in the AI ​​industry, which could significantly improve their long-term prospects.

Which stocks lead the charge?

Mining companies that have already formally established AI and/or HPC capabilities include Bit Digital Inc (NASDAQ:BTBT), Core Scientific Inc (NASDAQ:CORZ), HIVE Blockchain Technologies Ltd (NASDAQ:HIVE), Hut 8 Corp (NASDAQ:HUT) and Iris Energy Ltd (NASDAQ:IREN).

We reached out to InvestingPro to take a quick look at these stocks to determine which might represent the best opportunities. To do this, we’ve gathered them into an advanced watchlist configured to display the following criteria:

The story continues

Source: InvestingPro

First, the only stock on the list considered a bargain by InvestingPro Fair Value and analysts is Hive Blockchain. Indeed, Fair Value assigns it a bullish potential of 80.1%, while analysts predict an 85.2% gain for the stock.

However, it’s also the worst-performing stock on the list over a one-month horizon and the only one with a below-average InvestingPro Health Score (2.39/5).

As for the other stocks on the list, Fair Value reflects a downside risk for each of them.

However, fair value is based on valuation models, which are themselves based on cash flows. By definition, therefore, they cannot account for the potential related to the transition of cryptominers to AI-related activities.

As for analysts, who are more inclined to consider the change in the BTC mining business model, they consider Iris Energy and Bit Digital to be “bargains”, assigning them an optimistic potential of +63.2% and + 71.4%.

Hut 8 and Core Scientific, meanwhile, are considered “undervalued” with bullish potentials of 25.7% and 29.6%, respectively.

Conclusion

Bitcoin mining’s shift to artificial intelligence and high-performance computing is a strategic response to the multiple challenges facing the cryptocurrency mining sector.

By leveraging existing resources and exploring new avenues, these companies aim to secure a prominent place in the AI ​​industry.

Much remains to be done, but this year is undoubtedly a major turning point for the industry, and against that backdrop, stocks like Hive Blockchain, Iris Energy and Bit Digital deserve a place on investors’ radar.

As you look to take advantage of the potential rise in Bitcoin mining stocks, InvestingPro’s tools can prove invaluable in picking future winners.

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Disclaimer: This article is written for informational purposes only. It is not intended to encourage the purchase of assets in any way, nor does it constitute an investment solicitation, offer, recommendation or suggestion. I would like to remind you that all assets are evaluated from several perspectives and are extremely risky, so any investment decision and the associated risk is at the investor’s own risk. We also do not provide investment advisory services. We will never contact you to provide investment services or advice.

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