Bitcoin miners have accumulated $11 billion in convertible debt within the past year, marking a significant step in their shift towards AI data centers. This convertible debt allows potential conversion to stocks, creating opportunities for miners to adapt.

In the wake of the April 2024 Bitcoin halving, which cut the mining reward by 50%, miners engaged in 18 bond offerings, as reported by TheMinerMag.

The average amount raised through these bonds has doubled, with notable companies such as MARA, Cipher Mining, IREN, and TeraWulf securing $1 billion each in single bond issues. Some bonds were issued with coupon rates as low as 0%, indicating investors’ willingness to forgo immediate interest for potential equity growth.

Convertible bond deals from July 2024 to October 2025. Source: TheMinerMag

In contrast, convertible bonds from the previous year typically ranged between $200 million and $400 million.

To mitigate revenue problems following the halving, the mining industry has diversified into AI data centers, aiming to adjust for lingering challenges presented by tokenomics, regulatory issues, and rising energy costs.

Miners Prepare for Competitive Energy Demands

The debt burden for miners has surged to $12.7 billion, representing a 500% increase over the last year, as detailed in a recent VanEck report. Analysts Nathan Frankovitz and Matthew Sigel highlighted ongoing concerns in the mining sector, attributed to steep expenditures on mining hardware that often require annual upgrades.

“Historically, miners relied on equity markets, not debt, to fund these steep capital expenditures,” they stated, likening the substantial hardware costs for competitiveness to a ‘melting ice cube.’

Bitcoin’s network hashrate continues to rise.

The ongoing increase in Bitcoin’s mining hashrate, which signifies the total computing power securing the Bitcoin network, necessitates that miners continually invest in greater computing and energy resources.

In October, US Energy Secretary Chris Wright suggested a regulatory change to enable data centers and miners to connect directly to energy grids. This measure intends to provide these energy-intensive operations the means to meet their energy demands while acting as manageable load resources, thereby enhancing electrical grid stability during peak demand periods.