Bitcoin (BTC) miners came under renewed pressure in late 2025 and early 2026 as weaker bitcoin prices, near-record network competition, and falling hashprice compressed margins across the sector, according to digital asset manager CoinShares.

In a new report, Head of Research James Butterfill said the weighted average cash cost to produce one bitcoin among publicly listed miners rose to approximately $79,995 during the fourth quarter of 2025. 

At the same time, hashprice, a measure of bitcoin miners' revenue per unit of hashing power per day, fell to around $36-$38 per petahash per second per day and then dropped further to roughly $28-$30 in the first quarter of 2026, a level he said implied more pain ahead for miners.

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Butterfill said the pressure follows what he described as the most challenging quarter for bitcoin miners since the April 2024 halving. The report pointed to a roughly 31% drop in bitcoin from an all-time high of around $125,000 in early October to around $86,000 by late December, alongside near-record hashrate that pushed many operators close to or below breakeven.

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CoinShares stated the worsening economics have already contributed to capitulation in parts of the sector, with three consecutive negative difficulty adjustments in late 2025 marking the first such streak since July 2022. The firm also said publicly listed miners have collectively reduced their bitcoin treasuries by more than 15,000 BTC from peak levels, citing sales by companies including Core Scientific, Bitdeer, and Riot, with MARA announcing on Thursday it has sold another 15,133 BTC alone.

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Going forward, CoinShares outlined a range of potential outcomes for mining economics depending on bitcoin's price trajectory. Butterfill said it is "not an unrealistic assumption to see bitcoin prices recover to $100,000," which would likely lift hashprice to around $37 per PH/s/day, while a move toward prior highs near $126,000 could push it to roughly $59.

Conversely, the firm said that if bitcoin remains below $80,000 for an extended period, hashprice could continue to decline alongside rising difficulty, though further miner shutdowns in that scenario could stabilize returns as unprofitable capacity comes offline.

AI pivot gathers pace as mining margins tighten

Against that backdrop, Butterfill said the migration of listed miners toward AI and high-performance computing is accelerating rapidly, driven by higher and more stable returns than bitcoin mining. Listed miners could derive as much as 70% of their revenues from AI by the end of this year, up from roughly 30% today, he added, while more than $70 billion in cumulative AI and high-performance computing contracts have now been announced across the public mining sector.

The report noted that the shift is widening the gap between pure-play bitcoin miners and infrastructure companies that are increasingly functioning as data center operators. CoinShares identified firms such as IREN, TeraWulf, Core Scientific, Cipher, and Hut 8 as moving further in that direction, while highlighting other operators like MARA remain focused on mining or on lower-cost, more intermittent energy sources better suited to bitcoin workloads than AI applications.

CoinShares also said the push into AI is reshaping the sector's balance sheets. Butterfill noted that several miners have taken on large debt loads to fund buildouts, including IREN with $3.7 billion in convertible notes, TeraWulf with $5.7 billion in total debt, and Cipher with $1.7 billion in senior secured notes, fundamentally changing the industry's risk profile.

Still, CoinShares said the recent decline in hashrate was modest relative to earlier industry shocks and does not point to a broader collapse in mining. The network peaked at about 1,160 EH/s in early October, fell to around 850 EH/s by early February, and has since recovered to roughly where it ended 2025, at around 1,020 EH/s, with the firm projecting that hashrate could reach 1.8 zetahash by the end of 2026.

CoinShares also pointed to shifting geographic dynamics, with the U.S., China, and Russia controlling about 68% of global hashrate. The U.S. gained roughly two percentage points of market share quarter-over-quarter, while emerging markets, including Paraguay, Ethiopia, and Oman, entered the top 10 as miners sought lower-cost power.