JPMorgan stated in a recent report that bitcoin mining companies with attractive power contracts could become potential acquisition targets for hyperscalers and artificial intelligence (AI) companies.
According to Coindesk, the report by JPMorgan estimated that publicly traded bitcoin mining companies in the United States consume up to 5 gigawatts (GW) of power and have an additional 2.5 GW of power, making them an attractive potential acquisition target.
Additionally, after the fourth bitcoin halving in April, block rewards further decreased from 6.25 BTC to 3.125 BTC, leading to financially strained bitcoin mining companies potentially being more open to acquisition offers.
The report also noted that post-halving, merger and acquisition activities in the mining sector are on the rise. This week, publicly traded bitcoin mining and hosting service provider Core Scientific announced a 12-year partnership agreement with cloud computing solutions provider CoreWeave. Core Scientific plans to provide 200 megawatts (MW) of infrastructure to CoreWeave, with the agreement expected to generate over $3.5 billion in total revenue for the mining company. Bloomberg reported that CoreWeave has offered approximately $1 billion in an all-cash acquisition of Core Scientific at $5.75 per share.
Furthermore, another large publicly traded bitcoin mining company Riot Platforms (RIOT) made a bid to acquire Bitfarms (BITF) last month, which was rejected by Bitfarms citing undervaluation. Bitfarms claimed to have received more acquisition offers from other parties.
JPMorgan stated in the report that the transaction between Core Scientific and CoreWeave could accelerate the cryptocurrency mining industry’s entry into high-performance computing (HPC) business.
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