The Bitcoin bear market has forced mining hardware manufacturers to retrench.
Between 2024 and 2026, the Bitcoin mining hardware industry did not experience widespread layoffs, but nearly all manufacturers underwent deep restructuring and strategic contraction. Leading firms like Bitmain avoided public mass layoffs, instead cutting labor costs through salary restructuring and delayed wage payments. Canaan terminated its AI semiconductor division entirely, refocusing resources on developing and expanding its 2C market for liquid-cooled A1566 miners to achieve technical cost reduction and product iteration. Ebang International, after its IPO failed and funding dried up, saw its market presence fade and effectively entered operational stagnation. Shenma and Avalon miners, lacking new product releases and brand activity, gradually withdrew from mainstream competition.
Meanwhile, overseas mining companies are accelerating their shift toward AI infrastructure. HIVE Digital, Core Scientific, and others have explicitly downsized their ASIC mining teams and deployed thousands of NVIDIA GPUs to build AI data centers. Core Scientific signed a 12-year, $5 billion AI hosting contract with CoreWeave, supporting 590 MW of compute load—marking a structural leap from “electricity-driven mining machines” to “compute-driven AI service platforms.” Iris Energy, TeraWulf, and Bit Digital have also signed GPU deployment agreements, with AI-related revenue projected to exceed 60% of total income by 2026–2027.
On the technology front, energy efficiency has become a survival imperative. Hybrid liquid-air cooling is now widely adopted; Canaan’s A1566 series improved efficiency by over 30%, and the industry’s average PUE dropped from 1.6 to below 1.2. All mining rigs with efficiency above 0.08 J/TH have been phased out. Simultaneously, miners have liquidated massive amounts of Bitcoin to secure cash flow—over 15,000 BTC were sold cumulatively in 2025. With mining costs at
87,000usd per BTC and the price hovering around 70,000, each coin mined incurs a loss of nearly $17,000, making continued mining economically irrational.
Business model innovation has become critical. Compute leasing has emerged as a key revenue stream: miners package idle capacity and sell it to AI firms on monthly contracts. Some are exploring blockchain-based asset tokenization and infrastructure for tokenized equities to pave the way for future financialization. Others have locked in long-term, low-cost power agreements with utilities to hedge against electricity price volatility.
The industry still faces severe challenges: countless small and mid-sized miners lack the capital and technical capability to transition to AI, facing bankruptcy. Former mining operations teams lack experience managing AI servers, creating a critical talent gap. China maintains strict policies against crypto mining, while overseas firms grapple with geopolitical and energy regulatory pressures. Global ASIC compute capacity still exceeds demand, and it remains uncertain whether AI demand can fully absorb the surplus.
Looking ahead to 2026–2027, mining hardware manufacturing will be sustained only by a handful of firms—Bitmain and Canaan—producing minimal volumes, with new product iterations nearly halted. Compute services will dominate, with AI hosting revenue expected to surpass 60%. Technological evolution will focus on integrating “mining + inference” functions into next-generation ASIC chips. The industry has fully transitioned from “hardware manufacturing” to “compute operations”—the golden age of physical mining rigs has ended; the era of digital compute infrastructure has begun.
