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Crypto for Advisors: Bitcoin Mining Will Be Different in 2025

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In today’s issue, Ben Harper from Luxor Technology provides an update on what’s happening with bitcoin mining this year.

Then, Colin Harper from Blockspace Media answers questions on the topic of mining and AI in Ask and Expert.

Sarah Morton

You’re reading Crypto for Advisors, CoinDesk’s weekly newsletter that unpacks digital assets for financial advisors. Subscribe here to get it every Thursday.

Bitcoin Mining Has Changed — It’s No Longer Just About the Price

The bitcoin mining investment thesis used to be simple — miners thrived when bitcoin’s price soared, and when it fell, they suffered. But in 2024, that equation changed. Bitcoin ETFs, hashrate markets and AI have fundamentally reshaped the industry, reducing miners’ dependence on bitcoin’s price. Here’s why mining is no longer just a bet on bitcoin, and what this means for investors.

2024: The Year Bitcoin Mining Diverged From Bitcoin’s Price

In 2023, Bitcoin mining stocks behaved like a high-beta proxy for Bitcoin, amplifying its moves — soaring higher when bitcoin rallied and crashing harder when it fell. But in 2024, this pattern broke down. Despite bitcoin reaching new all-time highs, mining stocks failed to reclaim their previous peaks.

The table below illustrates the shifting correlation between Hashrate Index’s Crypto Mining Index and bitcoin’s price, comparing weekly prices and returns before and during 2024:

Source: Hashrate Index, June 2020 — December 2024

The takeaway is clear: Bitcoin mining stocks are no longer just a straightforward bet on bitcoin’s price. This divergence stems from four key trends shaping the sector:

1. Institutional Bitcoin Adoption: The Advent of Spot ETFs

The launch of spot bitcoin ETFs in January 2024 reshaped institutional investment in bitcoin. With ETFs amassing over 1.3 million BTC and surpassing $100 billion in assets under management, the appeal of mining stocks as a bitcoin proxy faded. Instead of using miners as an indirect exposure, capital flowed directly into Bitcoin via ETFs, fundamentally shifting market dynamics.

2. The Halving and Its Aftermath: A Squeeze on Miner Economics

Bitcoin’s fourth halving in April 2024 cut the block subsidy from 6.25 BTC to 3.125 BTC per block, slashing miners’ primary revenue source in half. Historically, post-halving bitcoin price surges have helped offset lower rewards, but this time, miners faced additional headwinds:

Record-high network difficulty. Rising competition reduced individual miner rewards.

Falling transaction fees. Lower demand for blockspace diminished a crucial secondary revenue stream.

Hashprice collapse. Despite bitcoin’s rally, hashprice, an all-in measure of mining revenue per unit of computation (i.e., hashrate), plummeted 75%.

While bitcoin’s price soared 120% throughout the year, miners struggled to maintain profitability, leading to consolidation and strategic pivots within the industry.

Source: Hashrate Index

3. The Rise of Hashrate Derivatives: A Game-Changer for Miners

One of the most significant financial developments in bitcoin mining in 2024 was the rapid expansion of the hashrate derivatives market. This emerging market allowed miners to hedge future revenue streams and reduce exposure to bitcoin price volatility, fundamentally changing how they manage risk.

Traditionally, mining revenues were at the mercy of bitcoin’s daily price swings, making it difficult for operators to forecast cash flows or secure financing. However, with the rise of hashrate forward markets, miners could sell future hashrate production at a fixed price, locking in revenue months in advance. This financial instrument functions similarly to commodity futures in the energy sector, where electricity producers pre-sell power contracts to stabilize income.

In 2024, these once-nascent markets saw explosive growth. Over-the-counter (OTC) volumes surged more than 500% year-over-year on Luxor’s hashrate forward market, with contract durations extending up to 12 months. Meanwhile, regulated exchange trading took a major step forward with Bitnomial launching hashrate futures, making it the first regulated exchange to offer a bitcoin mining derivative product.

The maturation of hashrate forward markets signals a new era in mining finance — one where miners have greater control over their revenue streams, better access to capital, and improved resilience against bitcoin price volatility.

4. Bitcoin Mining Meets AI & HPC: A Convergence of Industries

With mining profits under pressure, many firms are pivoting to AI and high-performance computing (HPC) to diversify revenue. Bitcoin mining infrastructure shares key similarities with AI data centers — both require vast power and cooling capacity. However, the shift isn’t easy: AI infrastructure is more expensive per megawatt (millions vs. hundreds of thousands for bitcoin mining), requiring significant capital investment.

Some miners are embracing hybrid models, allocating some of their computing power to AI workloads while maintaining bitcoin mining operations. Firms like HIVE Digital Technologies, Hut 8, Core Scientific, and Bit Digital have already made the leap, securing lucrative AI contracts to grow and stabilize their cash flows.

Final Thoughts

Bitcoin mining in 2025 is no longer just about bitcoin’s price. Institutional capital, hashrate derivatives and AI-driven diversification are reshaping the industry, giving miners new tools to manage risk and optimize revenue. At the same time, post-halving pressures, rising competition and infrastructure costs have made efficiency and adaptability more critical than ever.

For investors and advisors, understanding these shifts is essential. Mining stocks no longer move in lockstep with bitcoin, and new financial instruments are changing how miners operate. As the industry continues to mature, those who recognize these structural changes will be better positioned to navigate the opportunities ahead.

Ben Harper, director, Luxor Technology

Ask an Expert

Are bitcoin miners actually serious about breaking into the AI market?

Absolutely. Since 2022, bitcoin miners have been increasingly exploring AI and high-performance compute (HPC) business lines. Some of the earliest movers in this shift were Hut 8, Hive, IREN, Core Scientific and Bit Digital. More recently, Riot put its 600 MW expansion at Corsicana on pause to evaluate the site for AI load, Cipher received a $50 million investment from SoftBank for its own AI project, and Lancium and Crusoe Energy are building a multi-gigawatt campus for AI as part of Project Stargate.

How will bitcoin miners tackle their AI transitions? Is there a one-size-fits-all approach?

AI/HPC strategies vary from miner to miner. Hut 8 and Bit Digital, for example, have opted to acquire existing data center businesses rather than build their own data centers from scratch or retrofit existing infrastructure. Core Scientific, on the other hand, is converting the massive power assets and infrastructure it has on hand for AI/HPC load in its partnership with CoreWeave (Riot could follow a similar model should it decide to convert portions of its Corsicana campus into an AI data center). And others, like Hive and IREN, have purchased GPUs to operate AI/HPC cloud services within their existing facilities. Each of these strategies have tradeoffs (the Hut 8 and Bit Digital model are low risk, low reward, while Core Scientific’s approach is high risk, high reward), and we will have a better idea of which approach is the most successful over the next few years.

With strong market demand for AI, will bitcoin miners still mine bitcoin?

For now, plenty of bitcoin miners — including MARA, Cleanspark and Bitfarms — are still focusing on bitcoin mining instead of chasing the AI/HPC golden rabbit. Even if bitcoin miners convert parts of their infrastructure into AI/HPC load, they will likely still mine bitcoin, even if they reduce their focus on this pursuit. Ultimately, bitcoin mining and AI/HPC are more complementary than competitive, as miners can use bitcoin mining to monetize energy that they have already paid for when AI/HPC demand is low.

Colin Harper, editor-in-chief, Blockspace Media

Keep Reading

The first ever bitcoin mining ETF is live, recently launched by Grayscale.

Sixteen U.S. states are eyeing bitcoin strategic reserves, along with the federal government.

At a press conference on Tuesday, U.S. crypto and AI czar David Sacks discussed regulatory clarity, fostering innovation, consumer protection, bitcoin reserves and stablecoins, among other topics.

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Bitcoin Network Hashrate Declined in June as Miners Reacted to Recent Heatwave: JPMorgan

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The Bitcoin (BTC) network monthly average hashrate fell about 3% in June, Wall Street bank JPMorgan (JPM) said in a research report Tuesday.

The hashrate refers to the total combined computational power used to mine and process transactions on a proof-of-work blockchain, and is a proxy for competition in the industry and mining difficulty. It is measured in exahashes per second (EH/s).

«Our sense is the decline was driven by seasonal weather-related curtailment in the U.S., and note that Cipher, IREN and Riot alone operate >80 EH/s in Texas,» analysts Reginald Smith and Charles Pearce wrote.

Bitcoin mining profitability continues to improve. The bank’s analysts estimated that miners earned an average of $55,300 per EH/s in daily block reward revenue last month, a 7% increase from April.

Daily block reward gross profit rose 13% month-on-month to the highest level since January, the analysts noted.

The total market cap of the 13 U.S.-listed bitcoin miners the bank follows rose 23%, or around $5.3 billion, from the previous month, the report said.

Operators with high-performance computing (HPC) exposure outperformed pure-play miners due to speculation of a deal between Core Scientific (CORZ) and CoreWeave (CRWV).

IREN (IREN) outperformed the group with a 67% gain, while Bitfarms (BITF) was the worst performer with a 19% decline, the report added.

Read more: U.S.-Listed Bitcoin Miners’ Share of Network Hashrate Hit Record High in June: JPMorgan

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Crypto Daybook Americas: Bitcoin Posts Record Monthly Close, but Euro Steals the Show

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By Omkar Godbole (All times ET unless indicated otherwise)

Bitcoin (BTC) ended June above $107,000 at a record monthly close. Still, the largest crypto’s 2.5% monthly gain failed to match the euro’s advance against the dollar, the most liquid FX pair in the world.

The eurozone currency rose nearly 4% against the greenback last month, hitting its highest since September 2021. That prompted some traders to switch to euro-pegged stablecoins, resulting in a notable increase in their market values.

The euro’s momentum highlights the continued broad-based decline in the U.S. currency, which means financial conditions will likely remain easy, even though the weakness hasn’t done much to lift a directionless BTC.

The prolonged range play has been widely attributed to selling by wallets with a history of holdings coins for over a year. The profit-taking continued on Monday, with on-chain realized gains hitting the $2.4 billion mark.

BTC was recently trading 0.6% lower over 24 hours at $106,500. Other tokens, including XRP, DOGE, SOL and ETH, followed suit, while BCH, ALGO, and PAXG stood out.

Some analysts called for patience in the wake of continued institutional adoption. On Monday, Germany’s savings bank network said it will enable crypto trading for clients within a year. Strategy disclosed another major BTC purchase last week, acquiring $531 million worth of BTC.

«While short-term momentum has faded, medium-term signals remain bullish, especially with corporate treasuries accelerating their accumulation pace. We slightly reduced exposure to protect capital but remain constructive — especially on altcoins with room to catch up,» Valentin Fournier, lead research analyst at BRN.

That said, the third quarter has historically been bitcoin’s weakest. Moreover, liquidity tends to be weaker as well due to summer holidays, which raises the likelihood of exaggerated price moves. Remember the yen-led crash in BTC from $70,000 to $50,000 in late July to early August last year? This calls for caution even as analysts maintain the long-term constructive outlook.

In other news, American Bitcoin, a crypto firm backed by Eric Trump, raised $220 million to buy bitcoin and mining equipment. An FTX creditor posted on X that claims under $50,000 received 120% payouts in February and May 2025.

Bloomberg ETF analysts James Seyffart and Eric Balchunas said that there’s a 95% chance the U.S. SEC will approve spot ETFs for LTC and XRP this year.

In traditional markets, analysts awaited the Fed Chairman Jerome Powell’s speech later Tuesday and Friday’s nonfarm payrolls. Stay alert!

What to Watch

  • Crypto
    • July 2: Shares of the REX-Osprey Solana Staking ETF (tSSK) are expected to begin trading on the Cboe BZX Exchange, making this the first U.S.-listed ETF to combine SOL price exposure with on-chain staking rewards.
  • Macro
    • Day 2 of 3: ECB Forum on Central Banking (Sintra, Portugal)
    • July 1, 9 a.m.: S&P Global releases June Brazil data on manufacturing and services activity.
      • Manufacturing PMI Prev. 49.4
    • July 1, 9:30 a.m.: “High Level Policy Panel” discussion chaired by Fed Chair Jerome H. Powell at the ECB Forum on Central Banking in Sintra, Portugal. Livestream link.
    • July 1, 9:45 a.m.: S&P Global releases (final) June U.S. data on manufacturing and services activity.
      • Manufacturing PMI Est. 52 vs. Prev. 52
    • July 1, 10 a.m.: The Institute for Supply Management (ISM) releases June U.S. services sector data.
      • Manufacturing PMI Est. Est. 48.8 vs. Prev. 48.5
    • July 1, 10 a.m.: The U.S. Bureau of Labor Statistics releases April U.S. labor market data (i.e. the JOLTS report).
      • Job Openings Est. 7.3M vs. Prev. 7.391M
      • Job Quits Prev. 3.194M
    • July 2, 9:30 a.m.: S&P Global releases June Canada data on manufacturing and services activity.
      • Manufacturing PMI Prev. 46.1
    • July 3, 8:30 a.m.: The U.S. Bureau of Labor Statistics releases June employment data.
      • Non Farm Payrolls Est. 110K vs. Prev. 139K
      • Unemployment Rate Est. 4.3% vs. Prev. 4.2%
      • Government Payrolls Prev. -1K
      • Manufacturing Payrolls Est. -6K vs. Prev. -8K
    • July 3, 8:30 a.m.: The U.S. Department of Labor releases unemployment insurance data for the week ended June 28.
      • Initial Jobless Claims Est. 240K vs. Prev. 236K
      • Continuing Jobless Claims Est. 1960K vs. Prev. 1974K
    • July 3, 9 a.m.: S&P Global releases June Brazil data on manufacturing and services activity.
      • Composite PMI Prev. 49.1
      • Services PMI Prev. 49.6
    • July 3, 9:45 a.m.: S&P Global releases (final) June U.S. data on manufacturing and services activity.
      • Composite PMI Est. 52.8 vs. Prev. 53
      • Services PMI Est. 53.1 vs. Prev. 53.7
    • July 3, 10 a.m.: The Institute for Supply Management (ISM) releases June U.S. services sector data.
      • Services PMI Est. 50.5 vs. Prev. 49.9
  • Earnings (Estimates based on FactSet data)
    • None in the near future.

Token Events

  • Governance votes & calls
    • GnosisDAO is voting on renewing its partnership with Nethermind for Gnosis Chain maintenance and development, proposing 750,000 DAI funding for the first year from June, with 4% annual increases. Voting ends July 2.
    • Radiant DAO is voting on potentially compensating users whose wallets were drained via unlimited token approvals in the October 2024 hack. If passed, a follow-up plan would outline stablecoin conversions, claim contracts on Arbitrum, and phased repayments. Voting ends July 2.
    • Arbitrum DAO is voting on lowering the constitutional quorum threshold from 5% to 4.5% of votable tokens. This aims to match decreased voter participation and help well-supported proposals pass more easily, without affecting non-constitutional proposals, which remain at a 3% quorum. Voting ends July 4.
    • Polkadot Community is voting on launching a non-custodial Polkadot branded payment card to “to bridge the gap between digital assets in the Polkadot ecosystem and everyday spending.” Voting ends July 9.
  • Unlocks
    • July 1: Sui (SUI) to unlock 1.3% of its circulating supply worth $122.75 million.
    • July 2: Ethena (ENA) to unlock 0.67% of its circulating supply worth $10.59 million.
    • July 11: Immutable (IMX) to unlock 1.31% of its circulating supply worth $10.65 million.
    • July 12: Aptos (APT) to unlock 1.76% of its circulating supply worth $52.7 million.
    • July 15: Starknet (STRK) to unlock 3.79% of its circulating supply worth $14.42 million.
    • July 15: Sei (SEI) to unlock 1% of its circulating supply worth $15.73 million.
    • July 16: Arbitrum (ARB) to unlock 1.87% of its circulating supply worth $30.33 million.
  • Token Launches
    • July 4: Biswap (BSW), Stella (ALPHA), Komodo (KMD), LeverFi (LEVER), and LTO Network (LTO) to be delisted from Binance.

Conferences

The CoinDesk Policy & Regulation conference (formerly known as State of Crypto) is a one-day boutique event held in Washington on Sept. 10 that allows general counsels, compliance officers and regulatory executives to meet with public officials responsible for crypto legislation and regulatory oversight. Space is limited. Use code CDB10 for 10% off your registration through July 17.

Token Talk

By Francisco Rodrigues

  • While all eyes were on the introduction of Robinhood’s tokenized stocks and on Kraken and Bybit’s xStocks debut, a layer-2 network built to streamline DeFi quietly launched its mainnet yesterday.
  • Katana’s mainnet went live after it saw pre-deposits near $250 million, according to DeFiLlama data. The blockchain is backed by GSR and Polygon Labs.
  • The non-profit Katana Foundation says the chain attacks three chronic pain points: thin liquidity, erratic yields and capital flight. It does so by folding yield generation into the base layer.
  • When users bridge USDC, ETH, WBTC, AUSD or USDT, Katana’s VaultBridge pushes those funds into lending pools such as those on Morpho and Sushi, then sends the earnings back to depositors and app builders.
  • A separate mechanism called chain-owned liquidity captures transaction fees to bankroll the network over time.
  • Katana is distributing its native token, KAT, through liquidity mining. KAT is non-transferable for now, but the team expects an exchange listing by next year. Holders will be able to lock tokens for vKAT and share in staking rewards.

Derivatives Positioning

  • Perpetual funding rates for most tokens major tokens, including BTC and ETH, held marginally positive. XRP led with near 10% rates while XLM and ADA showed bias for shorts with sub-zero readings.
  • On the CME, BTC and ETH futures basis remained locked in the annualized 7% to 10% range.
  • On Deribit, risk reversals out to August-end expiry showed a bias for protective puts, with subsequent tenors showing a mild bias for calls. In ETH’s case, bearishness in the short-term tenors was more pronounced.
  • Block flows over the OTC desk Paradigm showed demand for the September expiry BTC $180K call option.

Market Movements

  • BTC is down 0.91% from 4 p.m. ET Monday at $106,629.81 (24hrs: -0.96%)
  • ETH is down 1.81% at $2,458.53 (24hrs: +0.15%)
  • CoinDesk 20 is down 2.37% at 3,010.77 (24hrs: -0.17%)
  • Ether CESR Composite Staking Rate is up 7 bps at 2.96%
  • BTC funding rate is at 0.0048% (5.3042% annualized) on Binance

CoinDesk 20 members’ performance

  • DXY is down 0.47% at 96.42
  • Gold futures are up 1.49% at $3,357.10
  • Silver futures are up 1.81% at $36.50
  • Nikkei 225 closed down 1.24% at 39,986.33
  • Hang Seng closed down 0.87% at 24,072.28
  • FTSE is down 0.17% at 8,745.89
  • Euro Stoxx 50 is down 0.30% at 5,287.47
  • DJIA closed on Monday up 0.63% at 44,094.77
  • S&P 500 closed up 0.52% at 6,204.95
  • Nasdaq Composite closed up 0.47% at 20,369.73
  • S&P/TSX Composite closed up 0.62% at 26,857.11
  • S&P 40 Latin America closed up 1.41% at 2,694.58
  • U.S. 10-Year Treasury rate is down 2.9 bps at 4.197%
  • E-mini S&P 500 futures are down 0.26% at 6,237.50
  • E-mini Nasdaq-100 futures are down 0.33% at 22,817.75
  • E-mini Dow Jones Industrial Average Index are down 0.13% at 44,331.00

Bitcoin Stats

  • BTC Dominance: 65.34% (0.19%)
  • Ethereum to bitcoin ratio: 0.02307 (-0.6%)
  • Hashrate (seven-day moving average): 869 EH/s
  • Hashprice (spot): $57.97
  • Total Fees: 4.22 BTC / $455,433
  • CME Futures Open Interest: 147,470 BTC
  • BTC priced in gold: 32.2 oz
  • BTC vs gold market cap: 9.12%

Technical Analysis

BTC's daily chart. (TradingView/CoinDesk)

  • BTC fell 1% Monday, narrowly missing the bull flag breakout. The decline produced a bearish outside day candle, with a price range wider than the preceding day’s candle.
  • Bearish outside day candles appearing after notable price gains, as in BTC’s case, signal renewed bearish trends.

Crypto Equities

  • Strategy (MSTR): closed on Monday at $404.23 (+5.3%), -1.64% at $397.59 in pre-market
  • Coinbase Global (COIN): closed at $350.49 (-0.83%), -1.53% at $345.12
  • Circle (CRCL): closed at $181.29 (+0.48%), +1.98% at $184.88
  • Galaxy Digital (GLXY): closed at $21.90 (+9.66%), +3.47% at $22.66
  • MARA Holdings (MARA): closed at $15.68 (+4.32%), -1.85% at $15.39
  • Riot Platforms (RIOT): closed at $11.3 (+7.11%), -1.59% at $11.12
  • Core Scientific (CORZ): closed at $17.07 (+2.52%), -1.52% at $16.81
  • CleanSpark (CLSK): closed at $11.03 (+3.37%), -1.81% at $10.83
  • CoinShares Valkyrie Bitcoin Miners ETF (WGMI): closed at $22.74 (+4.74%)
  • Semler Scientific (SMLR): closed at $38.74 (+0.62%), +0.15% at $38.80
  • Exodus Movement (EXOD): closed at $28.83 (-3.42%), +1.14% at $29.16

ETF Flows

Spot BTC ETFs

  • Daily net flows: $102.1 million
  • Cumulative net flows: $48.95 billion
  • Total BTC holdings ~1.25 million

Spot ETH ETFs

  • Daily net flows: $31.8 million
  • Cumulative net flows: $4.23 billion
  • Total ETH holdings ~4.1 million

Source: Farside Investors

Overnight Flows

Top 20 digital assets’ prices and volumes

Chart of the Day

Stablecoin transaction volume in USD. (Artemis)

  • The dollar value of the total stablecoin transactions crossed above the $4 trillion mark in June, the most since January, according to data source Artemis.
  • The data shows that while BTC’s price didn’t do much in the month, adoption of stablecoin continued unabated.

While You Were Sleeping

In the Ether

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The Blockchain Group Raises $13M to Advance Bitcoin Treasury Vision

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The Blockchain Group (ALTBG), listed on Euronext Growth Paris has secured roughly 11 million euros ($13 million) in fresh funding as it doubles down on becoming Europe’s first bitcoin (BTC) treasury company.

This strategic move underscores the firm’s commitment to growing its bitcoin holdings relative to its share count, aiming to deliver long-term value to investors through exposure to digital assets.

Part of the fundraising included $1.18 million capital increase at 5.251 euro per share, completed under an “ATM-type” agreement with asset manager TOBAM.

In parallel, the company’s wholly owned Luxembourg subsidiary issued 10 million euros ($11.8 million) in convertible bonds, priced at 5.174 euro per share, reflecting a 30 percent premium over the June 27 closing price. TOBAM subscribed for 5 million euros while bitcoin pioneer Adam Back invested around 5 million euros.

The Blockchain Group currently hold 1,794 BTC, while the share price is up 1% on Tuesday.

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