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Bitcoin Mining Stocks Drop as Microsoft Abandons AI Data Center Plans
According to Bloomberg, Microsoft has abandoned plans to build several new data centers that were expected to generate about 2 gigawatts of power. Analysts attribute Microsoft’s withdrawal to the anticipated surplus in computing capacity for AI models, as well as the company’s decision to cease certain collaborative initiatives with ChatGPT manufacturer OpenAI. Over the past six months, Microsoft has canceled multiple data center leases and postponed plans to increase additional capacity. Bloomberg reports that Microsoft is expected to further slow down data center investments in the second half of 2025, shifting focus to equipping existing centers with hardware and equipment after completing its established construction of $80 billion.
As a result of this news, the stock prices of cryptocurrency mining companies such as Bitfarms, CleanSpark, Core Scientific, Hut 8, Marathon Digital, and Riot generally fell. This decline in stock prices underscores the increasing reliance of Bitcoin miners on AI model business after the “halving” event in April 2024, which will reduce mining revenues.
Market Reaction and Analysis
However, Benchmark stock analyst Mark Palmer stated in an interview that investors had long anticipated Microsoft’s reduction in data center plans. He believes that the drop in stock prices is “Microsoft-related.” According to previous reports from Zombit, a March report from Coin Metrics pointed out that miners are diversifying their revenues by “transitioning to AI data center hosting and repurposing existing infrastructure for high-performance computing.” For instance, in June 2024, Core Scientific committed to providing 200 megawatts of hardware capacity to support CoreWeave’s AI workloads.
Asset management firm VanEck stated in August 2024 that if Bitcoin mining stocks significantly invest in supporting AI, their total market value could increase by approximately $37 billion.
Microsoft’s Reduction in Computing Power Plans
Bloomberg reported that on March 26, TD Cowen analysts indicated that Microsoft has given up plans to build several new data centers that were originally expected to generate about 2 gigawatts of power. Analysts attribute Microsoft’s withdrawal to the anticipated surplus in computing capacity for AI models, as well as the company’s decision to cease certain collaborative initiatives with OpenAI. Over the past six months, Microsoft has canceled multiple data center leases and postponed plans to increase additional capacity. According to Bloomberg, it is expected that Microsoft will further slow down data center investments in the second half of 2025, shifting focus to equipping existing centers with hardware and equipment after completing its established construction of $80 billion.
Prospects of Mining Transitioning to AI
Despite the current unfavorable situation, the shift towards AI is still seen as a potential growth point for Bitcoin mining. VanEck’s analytical charts indicate that if mining companies successfully transition to AI data center operations, their valuations could significantly improve. However, Microsoft’s planned reductions undoubtedly cast a shadow over this transformation, impacting current stock prices and adding uncertainty to miners’ long-term expectations for AI business. Future market dynamics and corporate strategy adjustments are worth continued attention.
