Bitcoin Mining's Next Evolution May Be Owning The Rewards, Not The Hardware

The slump in Bitcoin (CRYPTO: BTC) prices, coupled with high energy costs, has led many miners to pivot toward a different business model: giving investors access to mining rewards without requiring them to own or operate the machines. While some miners are publicly traded, this avenue gives investors Bitcoin as their capital gain.

Some of the industry’s biggest operators are pivoting away from the business that made them prominent, and converting their facilities into artificial intelligence data centers and pursuing multibillion-dollar computing contracts.

Core Scientific (NASDAQ:CORZ) and TeraWulf (NASDAQ:WULF) both made this move out of tradition Bitcoin mining last year. Riot Platforms (NASDAQ:RIOT) signed a $9 billion, 20-year compute deal with Anthropic in August.

But while Wall Street focuses on the migration from Bitcoin mining to data centers, there is another angle taking shape: separating ownership of mining equipment from participation in the Bitcoin rewards that equipment produces. Crypto players who still believe in Bitcoin mining may no longer need to purchase specialized computers, negotiate electricity contracts or even run leasing operations for data centers. Instead, investors can acquire rights to mining output through platforms that manage the physical infrastructure. This could become increasingly important as mining economics tighten and industrial operators seek more profitable uses for their electricity and facilities.

"Running mining rigs yourself has become a business for people with substations and power contracts, which is almost nobody today, so the practical question for everyone else is whether they can get exposure to mining output without becoming an actual Bitcoin miner," said Mark Zalan, CEO of GoMining (CRYPTO: GOMINING), headquartered in Cyprus. "Tokenized hashrate is one solution, and five years out I’d expect most people who want mining exposure will hold a claim on someone else’s machines rather than buy their own."

Bitcoin Mining: Not What it Used to Be

The financial pressures driving the industry’s transformation are substantial. According to CoinShares’ September 2026 Bitcoin Mining Report, the weighted average cash cost of producing one Bitcoin among publicly listed miners reached approximately $75,500 during the second quarter, while Bitcoin ended June at $58,400.  That’s a money losing operation.

GoMining’s fleet accounts for roughly 2% of the global Bitcoin hashrate, the company said.

Hashprice, a measure of daily mining revenue per unit of computing power, averaged just $27.70 per petahash in June, an all-time monthly low. Transaction fees contributed less than 1% of block rewards, leaving miners heavily dependent on Bitcoin prices.

That had the miners courting the AI data center companies. They simply became a more attractive alternative. The miners have been switching to AI because they have years of experience in caring for computers and running large data centers.

Wolfie Zhao from The Energy Mag, a publication that rebranded from The Miner Mag to reflect the trend away from Bitcoin mining, told the BBC in August that the mining industry’s shifting business model will continue despite Bitcoin prices rising again. 

“We expect to see many public miners continue winding down their Bitcoin mining hardware in the coming quarters,” he said. 

The CoinShares report estimates that AI infrastructure can generate approximately $1.5 million in annualized profit per megawatt, compared with roughly $500,000 for Bitcoin mining based on current market realities.

IREN (NASDAQ:IREN) reported $70.5 million in quarterly AI cloud revenue, surpassing its $66.7 million in Bitcoin mining revenue for the first time. TeraWulf generated 71% of its second-quarter revenue from high-performance computing leases, the company said in its second quarter earnings release. Core Scientific paid a reported $41.9 million to terminate an agreement for next-generation Bitcoin mining equipment to spend it on AI-equipment instead.

Across the publicly traded mining sector, CoinShares identified more than $100 billion in disclosed AI and computing contract backlog. Those contracts underscore the changing economics of owning large-scale computing infrastructure.

A Different Way to Participate

For investors seeking Bitcoin mining exposure rather than AI data-center exposure, the industry’s transformation raises a different question.

Why own the hardware at all?

For Zalan at GoMining, investors can purchase mining capacity and receive Bitcoin rewards associated with that capacity, after applicable operating and maintenance charges, without directly managing the underlying equipment. GoMining’s Digital Miner is a tokenized Bitcoin-mining product. Instead of buying and hosting an ASIC machine, investors buy a digital claim on a share of physical mining hashrate operated by GoMining and its service providers. The platform runs the hardware and pays investors daily BTC rewards, minus ongoing maintenance fees. That’s their concept.

“Bitcoin was supposed to be open and available for everybody, but mining became an extremely high barrier to entry,” Zalan said in a May 2026 interview with CCN where he explained the Digital Miner pitch to would-be crypto investors.

That barrier of entry into mining reflects the pricing shifts as demand for computers, computer peripherals, routers and semiconductors are driven up by data center owners. This makes it unattractive for new miners to enter the market. 

Retail investors that bought Bitcoin miners because it was another way to capture the Bitcoin story now find themselves owning less of that story, and more of the AI data center story. Investors that want a pure Bitcoin miner will be hard pressed to find one.

Tokenized hashrate seeks to separate the economics of mining participation from the operational responsibilities of running a mining business.

“We want to make participation in Bitcoin mining simpler,” Zalan said during a 2025 KuCoin discussion.

The Digital Miner model does not eliminate mining costs or guarantee profitable returns. But it changes who manages those costs and how users obtain exposure to the resulting Bitcoin production.

"A holder (of tokenized hashrate) can verify what they’re owed rather than take our word for it," Zalan told me.  "Legally it’s a contractual and technical right to that output; it’s not equity in GoMining. The closest everyday comparison I can offer is a metered share of a power plant’s output rather than ownership of the power plant."

The Investment Case Is Changing

Wall Street is already reconsidering how it values traditional mining companies.

In August, Bernstein maintained its upside call on TeraWulf. In June, they said Cipher Digital (NASDAQ:CIFR) would outperform the market, describing both companies as emerging AI infrastructure platforms and setting price targets of $36 and $32, respectively. That’d be a huge move if they are correct as both stocks trade at around $13-$14 per share.

The investment thesis centers increasingly on electricity access, grid connections and long-term computing contracts rather than Bitcoin production or hashrate sharing under the GoMining model.

CoinShares found that mining companies with contracted AI or high-performance computing capacity traded at an average 12.9 times forward sales, compared with 3.7 times for miners without such contracts. That valuation gap illustrates a broader shift: investors are rewarding companies for being part of the AI story, not for their attachment to Bitcoin.

GoMining, meanwhile, is underperforming BTC and all of the publicly traded ex-pure play miners so far this year. Over the last 12 months, investors were better off holding GoMining tokens than Bitcoin itself. GoMining has even outperformed Riot.

The possibility of a smaller or more economically disciplined mining industry is coming down the pike as established companies like Riot travel down the AI lane. Other models may pursue on delivering access to Bitcoin production itself as an investment driver through hashrate tokenization, of which GoMining seems to have pioneered.

For pure play BTC mining investors, the thesis is no longer about buying who owns all the machines and has low electric bills. It will either be to diversity submitting to your miner being more of an AI data center play, or pick the miner that lets you keep some of the Bitcoin their machines produce.

"Hashprice touched a record low this year, while margins ground toward breakeven," said Zalan.  "Digital Miner returns are a function of hashprice and this year showed how unforgiving that gets. If BTC stays weak while difficulty grinds higher, yield compresses, and on the least efficient hardware it can go negative before fees. What tokenized hashrate holders have that a leveraged corporate miner does not is optionality," Zalan said. "You can upgrade into newer machines, and exit through the marketplace rather than being stuck with hardware nobody wants."

The writer owns Bitcoin. Cover art created by the author using Canva.

Benzinga Disclaimer: This article is from an unpaid external contributor. It does not represent Benzinga’s reporting and has not been edited for content or accuracy.