JPMorgan Analysts Reported on Bitcoin Miners: “They Have About 9 Months”

Bitcoin (BTC) miners in the United States are facing a crunch time to land contracts with hyperscalers and artificial intelligence startups for data center and high-performance computing (HPC) services, according to a new report by JPMorgan analysts.

The report estimates that miners have around nine months to negotiate advantageous deals while data centre applications await approval and grid connections.

JPMorgan analysts Reginald L. Smith and Charles Pearce explained that Bitcoin miners currently have a limited opportunity to partner with a select group of well-funded hyperscalers and AI startups: “We think elite miners have about nine months to sign favorable agreements with a handful of well-funded hyperscalers/AI startups, while data center applications remain in limbo awaiting approval and or grid interconnection.” The increasing demand for AI-driven computing presents this opportunity, according to the report.

Analysts noted that Bitcoin mining facilities are increasingly being considered for their potential as AI GPU hosting hubs. However, the number of potential partners for miners remains small, primarily consisting of large hyperscalers and well-capitalized AI startups. The report also highlighted the high investment costs, noting that equipping a 100 MW site with the latest generation of GPUs could cost up to $3 billion.

JPMorgan’s report suggests that Bitcoin miners could leverage their existing infrastructure to meet the growing demand for HPC hosting centers. US-listed BTC miners currently have access to over 5 gigawatts (GWh) of power, with another 6 GWh under development. In comparison, over 12 GWh of data center capacity has accumulated in various stages of planning and construction, and it could take up to six years to get approved and completed.

The report also provides information about the US power grid, noting that the country has a total electricity generation capacity of approximately 1,300 GWh. Data centers and BTC mining sites together consume approximately 2% of the country’s energy; 21 GWh for data centers and less than 1% (5 GWh) for BTC mining.

Demand for data center capacity is expected to remain strong, according to analysts, who pointed to joint outlooks from Nvidia and the five largest U.S. hyperscalers, as well as a constrained power grid, as indicators of “insatiable demand for data center capacity through 2026.”

*This is not investment advice.