Written by: Cathy
Mining one Bitcoin costs eighty-seven thousand dollars. Selling it, the market only offers you sixty-seven thousand dollars.
For every coin mined, there is a net loss of twenty thousand dollars. It's not the loss from transaction fees, nor the fluctuations in electricity costs; it is a solid loss, with each Bitcoin produced costing an additional twenty thousand dollars. This is the reality in March 2026, with data from Glassnode and MacroMicro pointing to the same conclusion: Bitcoin mining, at the current price, is a money-losing business.
But the miners did not sit and wait for death. They made a choice that the entire market did not expect – they stopped mining and sold electricity to AI.
To be precise, it is not that they 'stopped mining,' but rather they emptied their Bitcoin treasury and invested all funds into AI data centers, relegating mining to a side business.
Since Bitcoin began its downward turn from the historical high of $126,000 in October 2025, publicly listed mining companies have sold over 15,000 Bitcoins in total. This is not sporadic cashing out, but an organized, strategic retreat.
01 Miners collectively liquidate; where did 15,000 BTC go?
Core Scientific is the one that acted earliest and most decisively.
In January 2026, it sold about 1,900 Bitcoins in one go, cashing out $175 million. The remaining plan is to clear all holdings in Q1. This company, which previously underwent bankruptcy restructuring, is now transforming Texas mining sites into high-density AI hosting facilities, aiming to allocate a total power capacity of 1.3 GW entirely to AI.
MARA is more ruthless. This company, known for 'never selling coins,' quietly changed its treasury policy in its 10-K annual report in March 2026—authorizing the sale of all 53,822 Bitcoins. At the time's prices, this amounted to nearly $4 billion, turning overnight from 'strategic reserves' into 'available funds.' Shortly after, MARA signed a joint venture agreement with Starwood Capital to deliver 1 GW of AI data center capacity.
What surprised people the most was Cango. This company's predecessor was a car finance platform in China, which only ventured into Bitcoin mining at the end of 2024, and ended up selling 4,451 Bitcoins in February 2026—60% of its reserves, cashing out $305 million for debt repayment and AI transformation. It also recruited former Zoom executive Jack Jin as CTO for its AI business, planning to install containerized GPU computing nodes in global mining sites. A company that did car loans transformed into a miner in just two years, and then from a miner into an AI inference service provider—such speed of cross-industry transformation can only be seen in the crypto space.
The choice of Bitdeer seems more like a meticulously calculated move. In February, it cleared its own Bitcoin holdings. Founder Wu Jihan's response was very candid: having zero holdings does not mean it will always be zero; liquidity is needed now to seize the window for acquiring electricity and land. Unlike other mining companies, Bitdeer is clearing its holdings while aggressively ramping up production—January's Bitcoin output surged by 430% year-on-year, with self-mining hash rate reaching 63.2 EH/s, surpassing MARA and becoming the largest publicly listed mining company by self-mining hash rate. Clearing the coins on the books has led to significant expansions in hash rate and infrastructure. There is decisiveness akin to 'cutting off a hand' and ambition like 'loading ammunition.'
02 The same electricity is worth 10 times as much when used for AI
Why are miners selling so uniformly? Because after calculating the numbers, the answer is too obvious.
Mining is losing money, but mining companies have something that everyone in the world is scrambling for: electrified land.
After the halving in 2024, Bitcoin mining's profit margin has shrunk from over 90% during its peak to the breakeven line. But during the same period, the demand for electricity and data centers from AI has exploded. According to MarketsandMarkets, the global AI inference market is expected to grow from about $106 billion in 2025 to nearly $255 billion by 2030.
Morgan Stanley calculated that shifting 1 megawatt of power from mining to AI hosting could yield a valuation premium of over 10 times.
This is not an exaggeration. AI hosting contracts are usually long-term agreements lasting 10 to 15 years, with clients being investment-grade giants like Microsoft and Meta, providing stable and predictable cash flow. In contrast, mining income completely depends on coin prices—and you know how volatile coin prices can be.
Wall Street has cast its vote with real money. Morgan Stanley has granted Core Scientific a loan limit of $500 million, with provisions that could increase to $1 billion. This is not a loan to a 'crypto company'; it is a credit endorsement for a 'digital infrastructure company.' TeraWulf and Cipher Mining were rated 'overweight' by JPMorgan for their successful hybrid models, while MARA, which once staunchly held onto Bitcoin, was downgraded due to excessive exposure to coin price risks.
The signals from the capital markets could not be clearer: in the eyes of Wall Street, the value of these companies no longer depends on how much Bitcoin they hold, but on how much electricity they control.
03 On-chain indicators suggest that we might be nearing the bottom
Miners collectively dumped their holdings, and the market wailed in despair. But if you look at the on-chain data, you'll find a set of very interesting signals.
The Hash Ribbon has inverted since the end of November 2025, and by February 2026, it had lasted a full three months—this is one of the longest periods of miner surrender in history. The last time a similar combination of signals appeared was in December 2022, when Bitcoin bottomed at $15,500. As of early March, the 30-day moving average is approaching the 60-day moving average from above, signaling a potential recovery.
The MVRV Z-Score maintained between 0.43 and 0.49 in early March. This indicator measures the deviation of market price relative to 'real value.' Historically, whenever the Z-Score falls into the range of 0 to 1, it has almost always corresponded to strategic accumulation windows.
The Puell Multiple has dropped to around 0.6, meaning miners' daily income has been compressed to about 60% of the annual average level. It is not far from the 0.3 at the bottom of the bear market in 2022, and miners' profit margins are being squeezed to historic lows.
The most extreme signal comes from market sentiment. During the 'Bitcoin Polar Vortex' in February, the Crypto Fear & Greed Index plummeted to 5, with a daily loss of $3.2 billion on February 5 setting a historical record.
Four independent directional indicators are simultaneously flashing red. The last time this happened, Bitcoin was forming a bottom.
04 Miners selling coins, could it actually be a positive signal?
This is the most counterintuitive part of the entire story.
In the past, miners' sell-offs were seen as bearish signals—these individuals are the 'native sellers' of Bitcoin, selling what they mine, creating sustained selling pressure in the market. However, the nature of sell-offs in 2026 is completely different: these mining companies sell Bitcoin and then shift to earn dollar revenues from AI.
Think about what this means. Previously, Core Scientific had to sell hundreds of Bitcoins each month to pay for electricity and operational costs. Now, it has long-term contracts signed with Microsoft and a credit line from Morgan Stanley. Although it still plans to cash out the majority of its remaining Bitcoin holdings (holding about 2,537 by the end of the year, having sold more than half), this is no longer a passive 'selling coins to survive,' but an active clearing of holdings, concentrating funds into AI infrastructure. Once the joint project between MARA and Starwood is realized, the dollar cash flow generated from that 1 GW data center will be enough to cover all costs.
In other words, mining companies transitioning to AI have transformed from structural sellers of Bitcoin into neutral or even potential buyers. The largest batch of 'natural shorts' in the market is permanently exiting.
Bitcoin mining itself has not disappeared; it has simply changed its mode of existence. MARA's hybrid model has pointed the way: mine when electricity prices are low, switch to GPU computing during peaks in AI demand. Bitcoin has become the 'flexible load' and 'insurance mechanism' of the power grid, with AI responsible for generating revenue and mining serving as a safety net.
05 Summary
In 2025, the Bitcoin network's hash rate just broke the milestone of 1 Zetahash. In the short term, some mining facilities transitioning to AI will indeed slow down hash rate growth—for example, Cango has taken 31% of its hash rate offline for upgrades. But this is actually a form of healthy capacity clearing: inefficient miners exit, leaving behind more efficient and focused players, increasing network security.
This is not the miners' surrender; it is the evolution of mining.
As mining becomes a side business and AI becomes the main business, Bitcoin loses a group of miners forced to sell coins, but gains a healthier supply structure.
The Bitcoins in miners' hands have sold out, but the electricity remains.