Private equity funds target Bitcoin mining companies, betting on the transformation of high-performance computing (HPC) computing power
AI computing power and Bitcoin mining have something in common, both require extremely large amounts of energy as backing. In view of this, private equity funds are turning to Bitcoin mining companies to evaluate the potential of mining companies to transform into high-performance computing (HCP) providers. Although the two have similar needs for computing power, the actual transformation path is not easy.
(Miner computing power transfer: The encryption market has been hit hard, and some have switched to AI artificial intelligence)
HPC and Bitcoin mining: similar computing power requirements, different chip designs
High-performance computing (HPC) and Bitcoin mining both require large amounts of computing power, but they use different types of chips.
HPC chips are designed to handle a variety of complex computing tasks, such as scientific simulations, climate modeling, financial analysis, etc. They have high flexibility and programmability and can adapt to different application scenarios. The Bitcoin mining chip (ASIC) is specially designed for the Bitcoin mining algorithm (SHA-256). They can only perform this specific type of computation efficiently and perform poorly on other tasks.
While some Bitcoin mining companies are beginning to explore using their ASIC miners for HPC tasks, this requires significant modifications to hardware and software and may not be as efficient as dedicated HPC chips.
Demand for AI computing power prompts CoreWeave to sign contracts with Bitcoin mining companies to ensure energy
In June this year, CoreWeave, a cloud computing company invested by Nvidia, signed a 12-year contract with Bitcoin miner Core Scientific to purchase 200 megawatts (MW) of power. Host NVIDIA GPUs from mining companies by purchasing energy to ensure the company's AI computing power is stable.
On July 3, Core Scientific's stock price rose briefly after the official website released trading information. Later, as Bitcoin collapsed, the price currently fluctuates between 9.5 and 10.5.
Large-scale artificial intelligence (AI) companies are exploring different alternatives to secure their energy needs, and U.S.-listed Bitcoin miners have access to large amounts of power, making many Bitcoin miners potential acquisition targets.
Bitcoin mining companies open up new opportunities to ease the pressure of market fluctuations
Large-scale Bitcoin miners have transformed to provide AI computing power, providing mining companies with solutions to the operational challenges brought about by Bitcoin price fluctuations and alleviating some operating cost pressures.
(In response to the halving dilemma, crypto miners are transforming! JPMorgan Chase: is providing services to the AI market)
In the past, a decline in Bitcoin's total computing power was often interpreted by the market as a bearish signal, which could lead to a decline in Bitcoin prices. In order to make up for their losses, miners may increase their computing power to compete for block rewards, further intensifying competition. However, the emergence of AI computing power demand has provided mining companies with a stable source of income, helped alleviate the miner selling problem caused by market declines, and changed the market structure.
Although the long-term impact of Bitcoin miners' transformation of AI computing power on Bitcoin prices is still unclear, what is certain is that this provides a new development direction for mining companies in a challenging market environment.
This article From Bitcoin to AI: Mining companies’ computing power transformation, energy demand becomes the key to cooperation first appeared in Chain News ABMedia.
