Investment firm VanEck has projected that Bitcoin miners could increase their annual revenue by $13.9 billion by reallocating 20% of their energy capacity to artificial intelligence (AI) and high-performance computing (HPC) by 2027.

This shift towards hybrid data center strategies is emerging, where Bitcoin mining facilities begin to host AI operations, creating a more diversified revenue stream.

The VanEck report arrives at a challenging time for Bitcoin miners, particularly following the recent Bitcoin halving in April, which reduced mining rewards significantly.

The cost of mining has surged, with projections indicating that expenses using Antminer S19 XPs could double to $80,000, while Bitcoin's trading price hovers around $59,550.

Currently, Bitcoin miners are facing financial difficulties, reporting a net income of -$335 million, underscoring the potential for significant financial improvement.

Many Bitcoin miners are struggling with poor financial health, attributed to high debt levels, excessive share issuance, and substantial executive compensation.

Kerrisdale Capital has criticized the Bitcoin mining sector, with Chief Investment Officer Sahm Adrangi highlighting that many companies dilute their value by issuing shares without delivering returns.

Despite these challenges, companies like Core Scientific and TeraWulf have managed to outperform their peers by focusing on AI and HPC revenue streams.

Core Scientific has signed a 12-year agreement with AI hyperscaler CoreWeave, projected to generate over $3.5 billion in revenue by providing 200 MW of energy.

Bitcoin miners are also exploring the use of stranded energy sources and recycling heat from mining operations to enhance energy efficiency.

VanEck suggests that engagement in AI and HPC could potentially double the market cap of mining stocks, with those focusing on these strategies outperforming their counterparts.