Crypto
11 Feb 2026
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How bitcoin mining stocks pivoting to data centers surge *
bitcoin mining stocks pivoting to data centers could double as they convert power into AI revenue.
Morgan Stanley says bitcoin mining stocks pivoting to data centers could see strong gains as AI demand outpaces supply. The bank highlights Cipher Mining and TeraWulf, arguing that “time to power” sites with quick deployment and high uptime can win premium contracts from hyperscalers, even as traditional data center builders face power bottlenecks.
Bitcoin fell hard in recent weeks, but some related stocks are rising on a new story. Two former pure-play miners, Cipher Mining and TeraWulf, now aim to power AI data centers. Morgan Stanley started coverage with “overweight” ratings and bold price targets, citing a deep shortage in AI compute and grid-ready power.
The call rests on a simple idea. AI needs massive power and fast build times. Many existing developers face slow interconnection and limited capacity. Miners already hold land, substations, and cooling. They can flip sites faster. That speed can attract hyperscalers that must scale now, not years from now.
Why bitcoin mining stocks pivoting to data centers could surge
Morgan Stanley’s analysts, led by Stephen Byrd, argue that compute demand is rising faster than supply. Recent capital spending updates from hyperscalers point to bigger budgets for GPUs, power, and land. When urgency is high, “time to power” wins. That is where converted mining sites can shine.The “time to power” premium
Hyperscalers value speed, uptime, and power density. A site that powers racks in months, not years, can command premium pricing. Former miners already run high-density loads and 24/7 operations. They can rework layouts for AI servers and hit service-level targets sooner than greenfield builds.The power-access bottleneck
Power is the choke point. Interconnection queues are long. Transmission upgrades are slow. Morgan Stanley notes that even if developers captured power from all large U.S. and European bitcoin companies, the market would still be short. That gap supports higher prices for fast, power-ready sites.Company snapshots: Cipher and TeraWulf
Cipher Mining: price target and path
Morgan Stanley set a $38 target on Cipher Mining, which implies about 158% upside from recent levels. The bank sees value in Cipher’s existing power footprint and its potential to reconfigure for AI clients. Cipher shares gained about 6% over the past week, even as bitcoin dropped roughly 10%.TeraWulf: price target and plan
TeraWulf earned a $37 target, implying roughly 159% upside. The firm also holds significant power access and operates energy-intensive sites. TeraWulf shares rose about 21% over the past week. The market appears to reward firms that can move quickly from mining to data center revenue.- Bitcoin recently traded near $70,386, down more than 40% from its peak above $126,000 last October.
- Cipher Mining: “overweight” rating; $38 target; about 158% implied upside.
- TeraWulf: “overweight” rating; $37 target; about 159% implied upside.
- Recent stock moves: Cipher up ~6% week-over-week; TeraWulf up ~21% week-over-week.
- AI compute and power demand keep rising as hyperscalers lift capital spending.
How miners turn racks into AI-ready data centers
From ASIC halls to GPU rooms
Bitcoin mines run fleets of ASICs in open, high-airflow rooms. AI training runs on GPUs that need different layouts, network fabrics, and redundancy. Conversion replaces racking, power distribution, and cabling. It adds hot-aisle or cold-aisle containment and improved control systems.Cooling and power upgrades
AI workloads run hot. Many sites move to liquid cooling or high-efficiency air with tighter containment. Power chains often need upgrades:- Higher-capacity transformers and switchgear
- More resilient uninterruptible power supplies (UPS)
- Stronger backup generation and fuel planning
- Better monitoring to prevent hotspots and downtime
Network and uptime requirements
Hyperscalers demand low-latency links, diverse fiber paths, and strict service levels. Conversion adds:- Redundant fiber routes and carrier-neutral meet-me rooms
- Tiered architectures for uptime guarantees
- Physical security and compliance upgrades
The risk list investors cannot ignore
Financing and credit constraints
AI-scale retrofits cost a lot. Companies may face credit limits or higher interest rates. If financing tightens, buildouts slow. That can push out timelines and reduce the “time to power” advantage.Model-scaling uncertainty
Large-language models could hit scaling walls or shift toward more efficient designs. If compute growth slows or spreads across more edge locations, demand for huge single sites could ease. That would pressure pricing power for converted mines.Retrofit cost overruns
Old shells hide surprises. Cooling retrofits, power gear lead times, and supply chain hiccups can raise costs. If budgets run hot or schedules slip, returns fall. Diligent planning and fixed-price contracts can help, but execution still matters.Why this pivot stands out now
Three forces line up at once:- AI demand surges as new models and services roll out.
- Grid interconnection stays slow, making ready-to-power land scarce.
- Miners own sites with power, cooling know-how, and 24/7 ops teams.
Signals to watch in 2026
Power contracts and interconnection queue wins
Track new power purchase agreements, substation upgrades, and interconnection milestones. Faster queue progress means earlier revenue and stronger negotiating power.Signed hyperscaler deals and visibility
Multi-year leases or capacity reservations with big cloud firms are the strongest proof. Look for:- Contract length and renewal options
- Uptime and service commitments
- Embedded pricing escalators tied to power or inflation
Capex discipline and build timelines
Investors should compare guidance to execution. On-time energization and on-budget spend show control. Delays or overruns weaken the premium that “time to power” aims to capture.Market backdrop: Bitcoin down, pivots up
Bitcoin’s slide has not stopped stocks tied to AI infrastructure. Over the last week, Cipher and TeraWulf both gained while bitcoin fell. That split supports the view that the market now values power, speed, and AI exposure more than mining hash rate alone. Still, these are not failproof trades. Credit markets, tech shifts, and construction risk can change outcomes fast. The upside is large, but so are the execution demands. Investors should size positions with care and watch quarterly updates closely.Bottom line
Morgan Stanley argues that a rare supply-demand setup in compute and power can lift former miners that deliver fast, reliable capacity for AI. Cipher Mining and TeraWulf lead this story today, with bold targets and rising attention. If execution holds, bitcoin mining stocks pivoting to data centers could be among the standout winners of the AI buildout. (p(Sou(rce: https://www.cnbc.com/2026/02/09/morgan-stanley-says-these-two-stocks-will-surge-as-they-pivot-to-data-centers.html)For more news: Click Here
FAQ
Q: What did Morgan Stanley say about Cipher Mining and TeraWulf?
A: Morgan Stanley initiated coverage of Cipher Mining and TeraWulf with “overweight” ratings and set price targets of $38 for Cipher and $37 for TeraWulf. Those targets imply roughly 158% and 159% upside respectively, according to the article.
Q: Why can former bitcoin miners convert sites faster than traditional data center builders?
A: Former miners already own land, substations, cooling infrastructure and operate at high density, enabling quicker redeployment than greenfield projects. This is why bitcoin mining stocks pivoting to data centers can capture a “time to power” advantage that attracts hyperscalers.
Q: What does “time to power” mean and why is it important?
A: “Time to power” refers to how quickly a site can be deployed and deliver reliable uptime, which matters because AI compute demand is rising faster than available supply. Hyperscalers may pay premiums for sites that can power racks in months rather than years, giving converted mining sites an edge.
Q: What are the main risks to the pivot from mining to data centers?
A: Key risks include credit or financing constraints that could slow buildouts, potential scaling limits or shifts in large-language models, and retrofit cost overruns that raise capital needs. These issues could delay timelines, weaken pricing power, or increase costs for bitcoin mining stocks pivoting to data centers.
Q: What infrastructure upgrades are typically required to make a mining site AI-ready?
A: Conversions usually replace racking and power distribution, add hot-aisle or cold-aisle containment, and upgrade transformers, switchgear, UPS, and backup generation to support high-density GPUs. Sites also need improved cooling (sometimes liquid cooling), redundant fiber routes, carrier-neutral meet-me rooms, and tighter security and compliance to meet hyperscaler requirements.
Q: How did Cipher and TeraWulf shares perform recently compared with bitcoin?
A: Over the past week, Cipher shares gained about 6% and TeraWulf about 21%, while bitcoin dropped roughly 10% over the same period. The article also noted bitcoin trading near $70,386, down more than 40% from its October record high around $126,000.
Q: What signs should investors watch to judge execution on the pivot?
A: Investors should track new power purchase agreements, substation and interconnection milestones, and any signed hyperscaler deals that show contract length, uptime commitments, and pricing. They should also monitor capex guidance versus actual build timelines and on-time energization to assess whether companies can capture the “time to power” premium.
Q: Why does Morgan Stanley think these stocks could more than double?
A: Morgan Stanley argues that a combination of surging AI compute demand, slow grid interconnection, and miners’ existing power footprints could let converted sites command premium pricing and faster revenue recognition. That thesis underlies the price targets implying roughly 158%–159% upside and supports the view that bitcoin mining stocks pivoting to data centers could more than double if execution holds.
* The information provided on this website is based solely on my personal experience, research and technical knowledge. This content should not be construed as investment advice or a recommendation. Any investment decision must be made on the basis of your own independent judgement.
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