Thursday, September 11, 2025 |
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It's important to have expert friends. It's been one of my cheat codes over the years. Especially in times like this, where it feels like you could throw a dart on the long side. But I find myself going back to the same guy, bull market after bull market. Louis Sykes has kept me on the right side of crypto for as long as crypto has been a thing. And the truth is that these are some of the most risk-on assets known to man. In the best of bull markets, investors reach as far as they can for risk. Right now, they're reaching for cryptos. I know this and Louis knows this. Because we've profited big in these environments before. We're going live tomorrow to talk about how we're trading the next crypto bull. I won't beg you to be there. Miss it at your own peril.
In the meantime, here's a primer on the difference between the best and worst Bitcoin miners. We'll break down what it all means tomorrow.
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This week, it became impossible to ignore the changing face of the Bitcoin mining industry.
In just one announcement, from a company that's never even touched Bitcoin before, shares of the largest miners went ballistic.
Our IREN Ltd $IREN position has already more than doubled, Applied Digital $APLD is up +20% in two days, Cipher Mining $CIFR has surged +45%, Bitfarms $BITF is up +40%, and Riot Platforms $RIOT is up +20%.
So what was the catalyst?
Neibus Limited $NBIS signed a $17.4 billion, five-year GPU supply agreement with Microsoft.
Big tech companies like Microsoft and OpenAI need immense amounts of computing power and electricity. Deals like this show just how valuable that capacity is, and the smart Bitcoin miners have been positioning for this shift.
Because let's be honest: Bitcoin mining is a brutal business. Margins get squeezed, profitability is volatile, and sustaining long-term returns is tough.
AI, on the other hand, is a different story. Margins are orders of magnitude higher.
That's why I went through every Bitcoin miner's filings and aggregated management's guidance to size up the magnitude of this repositioning. The takeaway? By next year, revenue from High Power Computing (AI) will start to climb meaningfully. By 2027, for many, it will rival, or even surpass, their Bitcoin mining income. |
But not all miners are created equal.
Some are pivoting aggressively into AI. Others are sticking with the old playbook: mine Bitcoin, hoard Bitcoin, repeat.
To separate winners from laggards, I mapped out each company's projected energy allocation, how many megawatts will go toward Bitcoin mining versus high-power AI compute, and overlaid it with the stock's YTD returns. The results were clear: the market is rewarding those leaning hardest into AI. |
That's why our IREN, APLD, and CIFR trades are outperforming, while MARA continues to lag.
And there's another dynamic at play. The market isn't just rewarding miners pivoting to AI, it's punishing those acting like treasury companies.
Take Marathon Holdings $MARA. It holds 52,477 BTC, the second-largest corporate stash after MicroStrategy. But investor appetite for these "Bitcoin treasury" models is fading. The premium investors once paid is compressing, especially as better vehicles like the iShares Bitcoin ETF $IBIT gain traction. Contrast that with IREN, which follows a strict no-HODL policy, selling all mined Bitcoin for cash. They aren't weighed down by this repricing, and their stock reflects it. And zooming out, I think this space still has legs. The Valkyrie Bitcoin Miners ETF $WGMI, a solid proxy for the sector, is only just breaking out. It's far from overextended. |
We're already positioned here. See you tomorrow. From where the sun rises first, Louis Sykes
Senior Crypto Analyst, All Star Charts |
Steve Strazza | Chief Market Strategist, All Star Charts |
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