AI Threatens Bitcoin Rather Than Supports It

Schiff: AI and Bitcoin Are Competing, Not Complementary

Gold advocate and longtime $BTC critic Peter Schiff is pushing back on one of the more popular narratives in crypto circles: the idea that the artificial intelligence boom is good for Bitcoin. In his view, the opposite is true. AI is a rival to Bitcoin, not a catalyst for it.

Schiff argues that Bitcoin supporters have made a fundamental mistake by tying the coin's investment case to the AI wave. He states that hopes for a rotation of funds from AI-related stocks into Bitcoin may be misplaced, and that both are instead competing for the same finite pool of speculative money. In his view, Bitcoin is likely to lose that fight.

Schiff has warned that AI could become a threat to Bitcoin, arguing that the two technologies compete for money, electricity, and infrastructure, while increasingly powerful AI could potentially uncover weaknesses in Bitcoin's software. That adds a longer-term technological risk to his already well-established critique of the asset.

Mining Firms Are Already Choosing AI Over Bitcoin

The competition for electricity and infrastructure is not just theoretical. The shift is already happening at scale. Mining revenue is projected to plummet from around 85% of total revenue in early 2025 to less than 20% by the end of 2026 for companies that have secured AI contracts, according to CoinShares' 2026 outlook. The shift represents a move away from volatile, low-margin mining operations toward stable, high-margin data center contracts, with companies that have pivoted generating 80% to 90% operating margins from AI deals.

Publicly listed Bitcoin miners are facing unsustainable economics and are rapidly pivoting toward AI and high-performance computing infrastructure, with more than $70 billion in AI and HPC contracts signed. Some miners could derive up to 70% of their revenue from AI by the end of 2026, effectively turning them into data-center operators that still mine Bitcoin on the side. IREN, formerly Iris Energy, is one prominent example. The company secured a five-year, $9.7 billion AI cloud contract with Microsoft in November 2025, covering NVIDIA GB300 GPU deployments across 200 megawatts of liquid-cooled capacity at its Childress, Texas campus.

Bitcoin's protocol does adjust mining difficulty every 2,016 blocks to keep block times steady, meaning the network can absorb some capacity losses. But the broader concern Schiff raises is one of capital allocation: money and energy flowing to AI data centers is money and energy not flowing to Bitcoin.

Schiff has maintained his critical position through several Bitcoin cycles, repeatedly contrasting the cryptocurrency with gold. He recently acknowledged regretting that he did not buy Bitcoin when he first encountered it, but followed the admission with another warning that holders could regret failing to sell. For Schiff, AI does not change that calculus. It only adds another competitor for the speculative dollar.

Sources:
ETF Trends: Bitcoin Miners Shift From Crypto to AI Data Centers (CoinShares)
CoinDesk: Bitcoin Miners Are Becoming AI Companies
Yahoo Finance: Peter Schiff Warns Bitcoin Faces Bigger Selloff Beyond Tech Rout