The analysts said several major miners, like Marathon Digital (NASDAQ:MARA) and Core Scientific Inc (NASDAQ:CORZ), have recently secured decent funding through convertible notes, with each company following its own unique approach.
Marathon Digital raised $300 million with plans to buy more Bitcoin, following the lead of MicroStrategy, which has pioneered using long-term convertible notes to acquire the original cryptocurrency as a corporate treasury asset.
Marathon’s notes were priced with a 25% premium and a 2.125% coupon, maturing in 2031. Meanwhile, Core Scientific secured $400 million with a 3% interest rate over a five-year term, intending to pay off high-cost debt and acquire AI-focused data centers.
Bernstein argues that the capital markets’ reaction highlights a growing divide among Bitcoin miners. Some remain committed to Bitcoin mining, while others are pivoting towards AI data centers. This latter approach, known as the “Mullet strategy,” puts AI data centers in the spotlight while keeping Bitcoin mining running in the background.
“Should all Bitcoin miners transition to AI data centers?” the note asks, citing strong interest from institutional investors in miners adopting AI/HPC (High-Performance Computing) strategies.
Bernstein suggests that this shift could provide miners with a more sustainable economic model, particularly as the AI industry continues to draw large investments.
The report also pointed out that U.S.-listed Bitcoin miners, with access to the world’s deepest capital markets, have a natural advantage over their unlisted and non-U.S. counterparts.
“This validates our long bias towards U.S. listed Bitcoin miners being market consolidators,” the note said.
Bernstein analysts also touched on the upcoming U.S. elections, noting that Polymarket trends are showing a close race between Trump and Harris.
The uncertainty around the election is keeping Bitcoin and crypto markets range-bound. Bernstein reaffirmed its view that a Republican victory, especially by Trump, would likely be seen as a positive for the crypto market.
Source: Cryptocurrency - investing.com
