Cryptocurrency miners are no longer being judged primarily on how much bitcoin they can produce. Instead, according to analysts at Compass Point, Wall Street is increasingly valuing these companies based on the artificial intelligence infrastructure deals they secure—and by that measure, Cipher Mining and TeraWulf look undervalued.
A New Way to Value Miners
For much of the industry's history, the fate of mining companies moved in lockstep with the price of bitcoin. That relationship is loosening. In a recent research note, Compass Point analysts Michael Donovan and Ed Engel argued that investors have shifted their attention toward the data center leases these firms are signing, rather than the coins they extract.
The change reflects a growing belief that energy-intensive mining operations may ultimately be worth more as AI computing hubs than as bitcoin producers. The power capacity and infrastructure that once fueled crypto mining are increasingly viewed as valuable assets for hosting AI workloads.
These operations may now be worth more powering artificial intelligence than mining digital coins.
Cipher and TeraWulf Stand Out
The analysts named Cipher Mining and TeraWulf as two firms trading below the value of revenue already locked into their contracts. Both companies have signed leases worth billions of dollars for AI-focused data center capacity, yet Compass Point contends that investors are giving them little credit for those pipelines.
That perceived disconnect, in the analysts' view, could represent an opportunity for investors willing to move beyond the traditional bitcoin lens and focus on the recurring, contracted income these companies are constructing.
- Both firms have secured multibillion-dollar AI data center leases.
- Compass Point argues the market is not pricing in their contracted revenue.
- The gap between signed deals and current valuations may signal upside.
An Industry-Wide Shift
The strategies pursued by Cipher and TeraWulf mirror a broader trend across the mining sector. Facing volatile crypto cycles, many operators are repurposing their power-hungry facilities to meet surging demand for AI computing, a market that prizes steady, long-term agreements.
As these extended contracts pile up, they are becoming the central driver of miner valuations, gradually replacing bitcoin's price swings as the metric that matters most to investors evaluating the sector.