Mining myth shattered? Miners collectively shift to AI: Bitcoin’s hashrate sees its first Q1 decline in 6 years

Data shows that Bitcoin’s total network hashrate declined in the first quarter this year, marking the first Q1 downturn in six years. As Bitcoin mining costs have surged to nearly $90,000 per coin, while the coin price is only $67,000, miners are losing money and collectively jumping ship, turning toward AI and high-performance computing (HPC) infrastructure with higher profits and greater stability. The “hashrate growth myth” behind Bitcoin is officially over.
According to Glassnode data, Bitcoin’s total network hashrate is currently hovering around 1 Zettahash (ZH/s), down about 4% year-to-date. Looking back over the past five years, Bitcoin’s hashrate has climbed from roughly 100 Exahash (EH/s) all the way to the Zettahash level we see today, with an overall growth of as much as 10x.
In the past, each year’s first quarter typically maintained strong upside momentum in hashrate, and the full-year increase often exceeded 10%, even showing near-doubling growth in 2022. However, that momentum has abruptly stopped this year.

The key reason for the slowdown in hashrate is that the mining industry’s economic model is rapidly deteriorating. Estimates suggest that the average production cost to mine 1 Bitcoin is now approaching $90,000, but the spot price of Bitcoin is only about $67,000. In other words, as soon as miners turn on their machines, they’re operating at a loss.
Facing an existential crisis, many large publicly listed mining companies have started adjusting their strategies, shifting toward artificial intelligence (AI) and high-performance computing (HPC) infrastructure. Compared with the wild swings in coin prices, the returns from providing AI computing power are more stable and more predictable, making it a new blue-ocean opportunity for mining operators to pivot.
This wave of transformation is largely supported by “selling coins and taking on debt.” Miners are reducing reinvestment in mining rigs, instead offloading the Bitcoin they hold or issuing debt to raise funds to build AI data centers. This strategy sharply increases the sensitivity of hashrate to coin prices. If coin prices remain weak, it may force more small individual miners to exit, leading to further declines in hashrate.
As hashrate continues to leak away, it inevitably raises market concerns about the security of the Bitcoin network. However, from another perspective, the degree of the network’s “decentralization” may be more important than simply pursuing the absolute size of the hashrate.
In the past, publicly listed miners in the United States alone accounted for more than 40% of the global hashrate landscape. Now that these North American giants are shifting their focus to AI, their once highly concentrated influence may be diluted. This, in turn, could help redistribute hashrate across the world, and in the long run may be more beneficial for decentralization.