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Wintermute issues a stark warning. Bitcoin miners are buckling under pressure, and waiting for the next bull run is no longer a viable strategy. There’s no choice.
The company’s report bluntly states: miners must become infrastructure and treasury experts to survive until the next halving. Jasper De Maere, an analyst at Wintermute, views the situation differently from the 2018 and 2022 cycles. Bitcoin halves its rewards every four years, but this time the price hasn’t doubled in tandem. The result? Miners’ revenues are genuinely decreasing. Over the past four years, Bitcoin has only grown 1.15 times. A far cry from the previous 10x to 20x multiples. Explosive increases used to cover everything, and miners relied on bull markets to recover poor margins after each halving.
Things are changing fast.
Now Bitcoin is playing with institutions, ETFs, and corporate treasuries. The asset behaves like a traditional macro instrument, making 20x pumps unlikely. Margins are in the red. In Bitcoin mining, costs are mainly energy and computing power. Simple but limited in protecting profits when revenues plummet. Wintermute’s analysis shows that gross margins peaked around 30% in this cycle. A level that marked the bottoms of previous bear markets, not the peak.
Transaction fees aren’t helping either. Fee spikes related to hype cycles and mempool congestion appear on charts but vanish quickly. They rarely contribute more than a few percent to miners’ total revenues.
The AI opportunity exists. But only for a few. The idea of pivoting to high-performance computing and AI workloads is gaining attention. Large tech companies and AI startups are eager to secure data center capacity quickly. For miners with sites already benefiting from cheap energy, it’s a natural fit.
But not all miners have the right location, strong balance sheet, or operational capacity to transform into data center companies. It’s not straightforward. This echoes themes explored in Bitcoin Eyes Historic Weekly Close Above, underscoring the shifting landscape.
Wintermute suggests another approach: active treasury management. Miners hold about 1% of all Bitcoin and have often followed a holding strategy. Yet, several have had to sell part of their treasury to offset reduced margins and debts. The company recommends using derivative strategies like covered calls and cash-secured puts to generate returns on their holdings, even at the cost of taking some market risks. Simultaneously, they can invest their coins in on-chain lending markets to generate interest income.
Bitcoin’s design still works, but the easy era for miners is over. Difficulty can adjust, but it can’t overcome slow price growth, an unchanged fee market, and rising energy costs that reduce each block reward.
Wintermute emphasizes cost adjustments for miners. By February 2026, several miners have already started reducing operational expenses by negotiating more competitive energy contracts. The goal? Mitigate the impact of compressed margins and extend the viability of their operations. Some companies, like Marathon Digital Holdings, are exploring innovative partnerships to maximize the use of their existing infrastructure.
In January, Marathon announced a collaboration with a tech startup to develop energy optimization solutions. This could reduce their costs by 15% by the end of the year. Not bad. Analysts have drawn connections to Bitcoin Crashes Below K as Panic amid evolving conditions.
And the volatility of Bitcoin prices in March 2026 has pushed miners to reconsider their hedging strategies. Wintermute notes that some companies are now adopting more aggressive hedging positions on Bitcoin futures to protect against further fluctuations. A rapid adaptation to changing market conditions.
The report also mentions that sector consolidation could intensify. Companies like Riot Platforms are considering strategic acquisitions to strengthen their market position. These moves could reshape the mining landscape, creating more robust entities capable of withstanding current challenges. The future looks tough without major strategic changes.
Consolidation is already happening on the ground. Cleanspark acquired three struggling mining facilities in Texas for $180 million in February, securing 50,000 ASIC machines at a bargain price. A strategy that allows big players to absorb the capacity of weaker ones.
Other regions are emerging as alternatives. Kazakhstan and Ethiopia are attracting miners with electricity rates below $0.03/kWh, compared to the U.S. average of $0.08. But geopolitical risks remain high in these areas.
