Shares of leading crypto mining companies fell sharply on Tuesday as investor enthusiasm for artificial intelligence (AI) infrastructure cooled and earnings concerns grew. CleanSpark (CLSK), Hut 8 (HUT), and Core Scientific (CORZ) dropped between 8% and 11.5%, wiping out more than $1.2 billion in market value.
CleanSpark slid 8% to $13.82, Hut 8 fell nearly 9% to $12.45, and Core Scientific lost 11.5% to $9.67. The sell-off came as traders moved away from high-growth AI-linked stocks following SoftBank’s decision to cut its Nvidia holdings and as overall tech sentiment weakened.
Trading volumes for the three miners surged up to twice their daily averages, with $450 million in sector liquidations recorded. Analysts said the drop reflected both profit-taking and doubts about the profitability of AI-related projects in the mining sector.
AI Pivot Loses Steam
The recent trend of crypto miners repurposing their data centers for AI computing is showing signs of slowing. CleanSpark and other miners had benefited from this idea earlier in the year, but rising energy costs and grid constraints have limited expansion plans.
SoftBank’s $1.5 billion sale of Nvidia shares last week further dampened investor confidence, leading to a broader pullback in AI-related equities. “The AI gold rush is meeting real-world limits like power availability and high costs,” one analyst told CoinDesk.
Earnings Worries Deepen
Investors are also bracing for disappointing earnings. CleanSpark is expected to report strong revenue growth for the third quarter but a larger net loss due to high GPU depreciation and stock-based compensation costs.
Hut 8 reported slower hashrate growth because of equipment delays, while Core Scientific faced higher spending on AI conversions. CleanSpark’s recent move to raise $1.15 billion through convertible debt also sparked dilution concerns, pushing shares even lower in after-hours trading.
Operational Challenges Mount
Analysts said that AI data centers are more profitable per unit of power than Bitcoin mining but face major practical hurdles, including grid delays and limited availability of land and skilled labor. The drop in Bitcoin’s hashrate to 1.26 ZH/s also suggested weaker on-chain activity, putting further pressure on miners.
Some Investors See Opportunity
Despite the sell-off, some institutional investors continued to buy. CleanSpark saw $25 million in ETF inflows, and large holders added Bitcoin to mining company treasuries, betting on long-term recovery. Analysts from Finbold forecast a rebound for CleanSpark to $18 by December if support levels hold.
Outlook
Crypto miners are at a critical point. If inflation data due Wednesday comes in lower than expected, it could ease market pressure and support a recovery. But if results disappoint, further declines are likely.
For now, investors appear to be reassessing the balance between promise and profit in the miners’ push into AI.
