Bitcoin Mining Stocks Plunge 35%. VanEck Claims Investors Made a Mistake

The October sell-off has severely impacted companies mining Bitcoin that are expanding operations in the artificial intelligence infrastructure sector. Their stocks have lost an average of 35%, but according to VanEck, the scale of the decline does not reflect the health of the businesses or the value of their assets. Investment managers describe the situation as a market anomaly rather than a collapse of the business model based on servicing AI data centers.

At the center of the dispute are companies like Hut 8 and Core Scientific, which utilize their energy resources and infrastructure to service the growing market for AI-related computing. However, investors have begun to treat them similarly to much more indebted computing power providers, fearing financing issues across the entire sector.

Mining Stocks Under Pressure from AI Financing Concerns

According to VanEck's analysis, the October sell-off affected companies with different business models. Investors treated energy infrastructure providers for data centers and operators renting out GPU computing power as one asset category. As a result, the financial troubles of some companies translated into a sell-off of the stocks of others.

Particularly significant were concerns regarding the costs of financing AI infrastructure. Cloud service providers, also referred to as neoclouds, must incur huge expenses to purchase graphics processors and expand data centers. High debt costs can limit their profitability, and the deterioration of sentiment towards this group of companies has also impacted firms supplying them with space and energy.

Additional pressure has come from macroeconomic factors. VanEck points to a higher-than-expected reading of the U.S. CPI for September and uncertainty ahead of the upcoming midterm elections in the U.S. In such an environment, investors have reduced exposure to risky assets, failing to sufficiently distinguish between individual business models.

Energy More Important than Processor Availability

A key argument from VanEck concerns the limited availability of electricity. In the firm's view, it is the connection capacity and access to power, rather than the demand for graphics processors, that remain the most significant constraint on the development of AI infrastructure. Bitcoin mines have a significant advantage in this regard: they possess land, energy infrastructure, and access to power that can be utilized in data centers.

In its June 2026 analysis regarding the valuation of Bitcoin mines as AI infrastructure, VanEck noted that access to energy and the execution of contracted projects are becoming the primary criteria for assessing these companies. Simply having ambitious development plans is not enough—secured power, signed contracts, and the ability to timely launch facilities are of utmost importance.

In its September commentary on the Bitcoin market, VanEck emphasized that limited energy availability could hinder the development of computing infrastructure. Companies that already have connected power thus have a significant competitive advantage.

Signed Contracts Remain an Important Argument

VanEck emphasizes that despite the nervousness in the market, there have been no cancellations of signed infrastructure lease agreements. This is an important distinction: concerns primarily revolve around companies' ability to raise capital and finance subsequent stages of development, rather than confirmed withdrawals of clients from existing contracts.

In the manager's view, long-term contracts provide companies with predictable cash flows that may justify higher valuations than suggested by the October sell-off. This particularly applies to so-called powered shell providers (PSP), which are companies providing clients with prepared facilities, access to energy, and infrastructure, without the need to supply all computing power themselves.

However, this does not mean that the risk has disappeared. The execution of projects requires significant expenditures, and financing issues, construction delays, or difficulties in activating contracted power can negatively impact company results. A signed contract does not automatically guarantee that the investment will be completed on schedule. It is also worth noting that the traditional Bitcoin mining model is also facing cost pressure and revenue volatility, which we analyzed more broadly in our material.

However, VanEck believes that the October sell-off may have excessively lowered the valuations of companies that already have access to energy and long-term contracts. For the market, this means a return to the fundamental question: are investors valuing the actual fundamentals of the businesses, or primarily concerns related to financing the entire AI boom?

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