Shares of Hive Digital and Bitfarms jumped more than 10% on Tuesday morning, as both firms accelerated their shift away from bitcoin mining toward artificial intelligence (AI) and high-performance computing (HPC) services. The gains came as bitcoin briefly traded above $76,100, its highest level in two months, and U.S. stocks recovered nearly all losses tied to recent U.S.-Iran tensions, with the S&P 500 hovering just below its January record.
Hive Digital ramps up AI operations
Hive Digital has entered full-scale AI activity through its BUZZ computing unit, recently launching a GPU cluster in Paraguay. The company now runs roughly 300 megawatts of hydro-powered capacity in the country, a base it plans to use for further AI build-out through 2027.
At the same time, Hive is scaling back parts of its traditional bitcoin mining footprint. The firm has reduced ASIC machine activity in Sweden and is redirecting capital toward expanding data center capacity in Canada.
Hive shares traded around $2.42 on Tuesday, up nearly 12%.
Bitfarms rebrands as Keel and pivots to hosting model
Bitfarms, now operating under the name Keel Infrastructure with a new Nasdaq ticker, is adopting a lease-based model focused on hosting large-scale computing clients.
Keel has outlined a 2.2-gigawatt development pipeline across the United States and Canada, backed by about $520 million in liquidity. The company expects new revenue streams from these operations to begin in 2027.
Keel shares were recently at $2.35, up more than 10% and trading at their highest level since January.
Broader crypto and infrastructure rally
The move in Hive and Keel shares coincided with gains across other digital infrastructure and mining-related names. Canaan, Bitdeer and IREN posted share price increases of roughly 7% to 10% on the day.
The strength in these names tracked a broader rebound in risk assets. The S&P 500 has now recovered nearly all losses incurred since the start of U.S.-Iran tensions and is trading just below its all-time high set in January.
Shift driven by post-halving economics
The strategic pivot away from a pure digital asset mining focus is closely tied to the difficult economics following the April 2024 bitcoin block reward halving.
The halving cut mining rewards, squeezing profit margins at the same time that global network hash rates have climbed more than 40% over the past two years, according to public blockchain data. This has pressured operators that continue to rely heavily on mining revenue.
In response, firms such as Hive and Keel are repositioning to tap the growing demand for AI and HPC capacity, a market that industry forecasts suggest could approach $1.8 trillion in value by the end of the decade.
Leveraging power and data center assets
These companies aim to monetize their existing advantages: large-scale data centers and long-term power purchase agreements that secure electricity at relatively stable, wholesale prices.
By redeploying power and rack space to GPU-based computing workloads, they are seeking more predictable, contract-based revenue rather than exposure primarily tied to the price of a single digital asset.
New fundamentals for market participants
For market participants, assessing these companies now requires a different set of metrics.
Performance is likely to hinge on:
- the volume of long-term contracts signed with AI and HPC clients
- the number of megawatts under contract for non-mining workloads
- the timing and scale of new facility deployments
Traditional mining metrics, such as contribution to network hash rate, may become less relevant than indicators of contracted capacity, utilization rates, and margin profiles in AI and HPC segments.
Upcoming earnings reports will be watched for signs of revenue diversification and margin strength from these newer lines of business. Keel has already indicated that contributions from its expanded infrastructure are expected to hit the income statement beginning in 2027.
Rising competition from hyperscale cloud providers
While the pivot offers a path to potentially steadier cash flows, these firms are entering an intensely competitive sector.
They will be going up against hyperscale cloud providers such as Amazon Web Services and Microsoft Azure, which together control more than half of the cloud infrastructure market. Winning and retaining enterprise clients in AI and HPC will likely require competitive pricing, reliable power access, and the ability to scale quickly as demand evolves.
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