Block reward miners pivot to AI as Trump tariffs tank BTC price

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Block reward miners are reeling as the BTC token’s falling price messes with their profitability, accelerating the need to raise cash to fund their ‘pivot to AI.’

• Mining’s elusive profits prompt major AI fundraising effort
• BTC a victim of its own ‘success’
• Bitmain-linked Texas facility raided by ICE
• September’s tale of the tape

The recent Trump-tariff-crypto-crash has proven doubly difficult for mining operators, sinking the BTC token’s value perilously close to the average cost of mining a single BTC. A week after the initial crash, the token is still struggling to regain its footing.

Meanwhile, the BTC network’s mining difficulty level continues to hit new all-time highs—rising another 5% in early October, the seventh straight increase—pushing the costs of mining a block ever higher.

In the last week of September, the BTC network’s total hashrate came within a whisker of 1.1 ZH/s, aka 1.1 sextillion hashes per second. The combination of miners continually upgrading their ASIC rigs to newer, more powerful units and deploying more rigs in total is resulting in ever greater demands on local electricity grids. The fact that solo miners still occasionally manage to find a block and claim the rewards must really stick in the craw of these mega-miners.

New data from CryptoQuant shows ~51,000 BTC tokens worth ~$5.6 billion recently flowing into digital asset exchanges from miner-linked digital wallets. The suggestion is that miners who would normally be adding mined tokens to their ‘treasuries’ are now looking to turn them into spendable cash pronto.

Coupled with BTC’s nonexistent transaction fees—because the only people stacking BTC are utility-bereft ‘treasury’ firms (including many miners) and exchange-traded fund (ETF) managers—mining profitability continues to trend downward. And while mining stock prices soared to all-time highs in late September as BTC hit new highs, the tariff brouhaha has since erased much of these gains.

Some of the more diversified miners—aka the ones that embraced ‘pivoting to AI’ as a far greener and more profit-predictable pasture—continue to enjoy investor confidence. That has led to an unprecedented volume of fundraising as they look to build more and larger data centers to keep up with the insatiable demands of AI developers.

On September 22, CleanSpark (NASDAQ: CLSK) announced it had increased its “Bitcoin-backed credit facility” with Coinbase Prime, the institutional brokerage platform of the Coinbase (NASDAQ: COIN) exchange, by $100 million. Just three days later, CleanSpark announced a different $100 million Bitcoin-backed credit facility with crypto lender Two Prime Lending. The company plans to spend this $200 million on building out both its mining and AI facilities.

Also on September 25, Cipher Mining (NASDAQ: CIFR) announced that it had upsized its $800 million debt issue to $1.1 billion, the proceeds to be used for expanding its Barber Lake, Texas data center.

On October 14, TeraWulf (NASDAQ: WULF) announced a $3.2 billion debt issue, with the proceeds intended to finance “a portion” of the expansion of its data center in Barber, New York.

That same day, IREN (NASDAQ: IREN) announced the closing of its $1 billion debt offering for ‘general corporate purposes and working capital,’ which, given the recent spate of IREN-related AI deals, means more and larger data centers.

On October 15, Bitfarms (NASDAQ: BITF) announced a new $300 million debt offering, and given the company’s ongoing transition from a mining-focused business to one utterly besotted with the possibilities of AI and other high-performance computing (HPC) options, you can see where this is likely headed.

BTC: a victim of its own success?

As further proof that the bloom is off the block reward mining rose, Galaxy Digital (NASDAQ: GLXY) announced on October 10 that it had received a $460 million “private strategic investment” from “one of the world’s largest and most respected asset managers.” This windfall will be used to “power the buildout of its Helios data center campus,” which at one point mined BTC but will now focus on AI/HPC computing.

Some miners have gotten out of the mining biz entirely, like Bit Digital (NASDAQ: BTBT), which in June announced it would sell off its mining rigs and become an ETH-based treasury firm. Bit Digital CEO Sam Tabar hasn’t minced words since this shift, recently declaring that his firm eventually “realized, and I think the other miners are finally realizing this, that [mining] is a very shitty business.”

Tabar went on to predict that the “Bitcoin mining industry is going to be dead in two years,” aka around the time the next ‘halving’ event occurs and the rewards-per-block fall from their current 3.125 BTC to just 1.5625. As rewards fall and network difficulty increases, Tabar feels that the only entities that will be able to profitably mine will be sovereign governments that can dictate the price of the energy they utilize.

It’s worth remembering that Satoshi Nakamoto’s long-term plan for Bitcoin was for the size of individual blocks on the network to increase and thus permit a sufficient number of transactions so fees could offset the scheduled reduction in rewards. Those who insisted that they knew better than Satoshi and artificially constrained the size of blocks will have a lot to answer for if/when Tabar’s predictions prove accurate.

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Don’t mess with Texas

Witnesses reported the involvement of “helicopters, snipers [and] armed men,” many of the latter arriving in “a cavalcade of black Tahoes.” In addition to ICE, agents from the Federal Bureau of Investigation (FBI), Homeland Security Investigations (HSI), and the Texas Department of Public Safety reportedly participated in the raid.

The detained individuals were reportedly Chinese nationals holding expired visas. The raid focused on an ASIC repair shop embedded within the facility that’s run by ADW Tech, an affiliate of Bitmain, the Chinese manufacturer that controls nearly 90% of the ASIC mining rig market.

It’s been suggested that the agents were also keen on determining whether any of the ASICs on site had links to Xiamen Sophgo Technologies, the Bitmain-affiliated semiconductor firm that was probed in 2024 on suspicion of evading U.S. export controls on chips produced in Taiwan.

Since Trump’s return to the White House, Bitmain and other foreign ASIC manufacturers have launched efforts to establish U.S.-based manufacturing facilities in the hopes of avoiding both punishing import tariffs and other legal entanglements.

Lonestar Dream was originally owned by Chinese mining pool Poolin, but the Texas facility was sold in early 2024 to China Green Agriculture (CGA), a producer of humic acid-based compound fertilizers. CGA’s former co-CEO Zhibiao Pan founded Poolin in 2017 and previously served as Bitmain’s director of software R&D.

Whatever the focus of the raid, this is probably not the best time for major media outlets to be questioning the rationale behind the apparently sweetheart deals on ASICs that Bitmain reached with American Bitcoin Corp (NASDAQ: ABTC), the mining firm spun off from Hut 8 (NASDAQ: HUT) this spring. ABTC’s co-founders include President Trump’s sons Don Jr. and Eric.

Last month, ABTC CEO Michael Ho dismissed concerns expressed by some members of Congress regarding the president’s family doing deals with such a controversial company. Ho noted that the ASICs have limited functionality and don’t present any security concerns. The subject of ethical concerns didn’t come up.

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September’s tale of the tape

IREN has yet to release its September report card for some reason, but most of the miners who turned in their homework on time showed a pattern of declining production despite rising hashrate, reflecting the ongoing financial challenges of this game. As always, these September 2025 production reports are listed below in descending order of magnitude.

• MARA Holdings (NASDAQ: MARA) produced 736 BTC in September, up from 705 in August, as energized hashrate nudged up one point to 60.4 EH/s. While the company’s BTC treasury increased to 52,850 BTC—the highest among all miners and the second-highest corporate treasury after Strategy (NASDAQ: MSTR)—MARA sold half the tokens it mined in September. This marks the first time in over a year that MARA has sold any of its tokens, reflecting the rising costs associated with winning blocks.
• CleanSpark mined 629 BTC in September, down from August’s 657, despite the average operating hashrate rising 2.3 points to 45.6 EH/s. CleanSpark sold nearly 445 BTC for $48.75 million in September, but its treasury still grew to 13,011 tokens, third-highest among miners.
• The usually hard-charging Cango (NYSE: CANG) produced 616.6 BTC in September, a retreat from August’s 663.7 tally despite a one-point bump in average operating hashrate. September’s haul brought Cango’s BTC treasury to 5,810 tokens, good for fifth place on the mining treasury chart.
• Bitdeer (NASDAQ: BTDR) bucked the downward trend by self-mining 452 BTC in September, one-fifth better than August’s 375 as the company deployed another 10,000 of its in-house SEALMINER A2 units. Bitdeer’s treasury increased to 2,029 tokens, 95 more than at the end of August.
• Riot Platforms (NASDAQ: RIOT) mined 445 BTC in September, 33 fewer than August’s total, despite operating hashrate rising 0.8 points to 32.2 EH/s. The decline wasn’t offset by Riot’s ‘power credits’ revenue—paid by struggling electricity grids to miners to switch off their rigs during periods of high demand—which totaled $1.4 million in September, less than 10% of August’s $16.1 million bounty. Riot sold slightly more BTC than it earned last month, reducing its treasury to 19,287 tokens, but still good enough for second-place behind MARA.
• BitFuFu (NASDAQ: FUFU) generated 329 BTC in September, 79 fewer than in August, despite hashrate rising 1.1% month-on-month. Self-mining operations produced 33 BTC, down from 55 in August, while cloud-mining customers’ production fell from 353 to 296. Regardless, BitFuFu’s treasury increased by 60 tokens to 1,959 BTC, with some of those gains coming from “disciplined, opportunistic Bitcoin purchases.”
• Hive Digital (TSXV: HIVE) produced 267 BTC in September, up from August’s 247, which was itself up from 203 in July. September’s total is also more than twice the 112 BTC that Hive produced in September 2024. Average hashrate continues to rise, up 1.4 points to 19.4 EH/s in September and the company insists it remains on track to hit its 25 EH/s target by November 27 (American Thanksgiving).
• Cipher Mining was also in positive territory, with September’s 251 total being 10 better than August’s. The gain is all the more impressive given that Cipher’s month-end operating hashrate was only 0.6 points higher than August’s 23 EH/s. (Better to be lucky than good, as they say.) Cipher sold 158 tokens last month, leaving its treasury at an even 1,500 tokens.
• Finally, Canaan Inc. (NASDAQ: CAN) produced 92 BTC in September, six fewer than in August, as its month-end operating hashrate dipped a point to 7.8 EH/s. However, deployed hashrate hit a new high of 9.3 EH/s, and the company sealed a deal for “over 50,000 Avalon A15 Pro miners—our largest single order in the past three years.” Canaan’s token treasuries also hit new highs of 1,582 BTC and 2,830 ETH, reflecting the company’s “disciplined accumulation strategy and operational efficiency.”

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