Twenty One CEO Warns Bitcoin Hashrate Is in Its First Bear Market
Bitcoin mining could also be coming into territory the business has by no means seen earlier than.
Rapha Zagury, CEO of Tether-backed bitcoin treasury firm Twenty One Capital, advised the Bitcoin Asia 2026 convention in Hong Kong that the community goes by its first “bear market in hash charge.”
“We’re dwelling, I believe, by the primary bear market in hash charge that we’ve ever seen in Bitcoin historical past,” Zagury mentioned throughout his Aug. 28 keynote.
Bitcoin’s hashrate approached 1.3 zettahashes per second late final 12 months earlier than starting a gradual decline. In keeping with Zagury, the present stretch marks the longest interval Bitcoin has spent under a hashrate document with out recovering.
That issues as a result of rising community hashrate will increase competitors between miners. When it falls, surviving operators can seize a bigger share of bitcoin manufacturing.
This Is Not One other China Mining Ban
Zagury argued that the present downturn appears to be like essentially completely different from 2021, when China’s crypto mining crackdown prompted hashrate to break down. Again then, mining machines largely moved to different jurisdictions and finally got here again on-line.
“What we’re seeing now, it’s very completely different,” he mentioned. “We hit near 1.3 zettahashes late final 12 months, and it’s been regularly coming down.”
The change comes as mining infrastructure has gained one other potential purchaser: synthetic intelligence.
Knowledge facilities constructed for bitcoin can supply entry to energy, land and grid connections that AI and high-performance computing corporations more and more worth. That offers miners an alternative choice to dedicating their whole infrastructure to bitcoin. Zagury mentioned that optionality is usually ignored when buyers worth mining companies.
AI Is Rewriting the Bitcoin Mining Commerce
The shift Zagury described is not theoretical. Throughout the bitcoin mining business, corporations are redirecting energy, land and>$819 million in liquidity, giving it capital to fund the transition.
Bitdeer has additionally moved aggressively. In August, the bitcoin miner signed a 16-year AI infrastructure settlement value about $4.7 billion for 121 megawatts of computing capability at its Tydal campus in Norway. The contract may attain roughly $8 billion if an extension is exercised.
Hut 8, in the meantime, secured a $9.8 billion, 15-year AI infrastructure lease overlaying 352 megawatts at its Beacon Level campus in Texas. Its broader contracted AI portfolio now spans 949 megawatts.
These offers give weight to Zagury’s warning that enormous public miners are more and more reconsidering pure-play Bitcoin mining. “For those who have a look at the general public mining corporations on the market, there actually isn’t anyone staying the course to mine bitcoin at scale,” Zagury mentioned.
For miners that stay dedicated, nonetheless, shrinking competitors might be a bonus. Zagury argued that operators that stay true to bitcoin mining naturally acquire a bigger share of the community as competing hashrate disappears.
The result’s an uncommon stress for the crypto business: AI could also be pulling infrastructure away from bitcoin, whereas concurrently enhancing the economics for miners keen to remain.
