Morgan Stanley initiated protection of three publicly traded bitcoin miners on Monday, assigning Obese scores to Cipher Mining (CIFR) and TeraWulf (WULF) whereas giving Marathon Digital (MARA) an Underweight ranking.
The transfer displays the financial institution’s view that sure miners are higher valued as infrastructure performs moderately than pure crypto or bitcoin bets.
Analyst Stephen Byrd and his staff set value targets of $38 for Cipher and $37 for TeraWulf. Shares of CIFR rose roughly 134% to $16.50 on Monday, whereas WULF climbed 13% to $16.20.
Marathon shares elevated barely to $8.28, beneath its $8 goal.
Morgan Stanley’s thesis focuses on the transformation of bitcoin mining websites into information heart belongings.
Byrd argued that when a miner has constructed an information heart and signed a long-term lease with a creditworthy counterparty, the asset must be valued for secure, long-term money circulation moderately than bitcoin publicity.
He likened these websites to information heart actual property funding trusts (REITs) comparable to Equinix (EQIX) and Digital Realty (DLR), which commerce at excessive multiples as a result of scale and predictable income.
Cipher Mining sits on the center of that framework. Byrd described its services as suited to what he referred to as a “REIT endgame,” the place leased information facilities perform like toll roads, producing predictable money flows with minimal reliance on bitcoin’s value.
TeraWulf additionally matches the mannequin, with a monitor report of signing information heart agreements and administration expertise in energy infrastructure. The agency plans to increase 250 megawatts of knowledge heart capability per 12 months by way of 2032, with Morgan Stanley modeling success charges of fifty% in a base case and 75% in an optimistic situation.
Marathon Digital obtained a extra cautious evaluation. Byrd famous the corporate’s hybrid method, combining bitcoin mining with information heart ambitions, limits upside potential from bitcoin-to-data heart conversions.
Marathon’s give attention to buying bitcoin and issuing convertible notes to fund mining positions makes its worth largely depending on bitcoin costs.
Morgan Stanley highlighted the corporate’s restricted historical past of internet hosting information facilities and the traditionally low return on invested capital in bitcoin mining as components within the Underweight ranking.
Bitcoin mining or AI?
The protection comes amid ongoing debate over whether or not bitcoin miners ought to evolve into energy and AI. Morgan Stanley’s stance is selective: miners with long-term leased information facilities might supply greater, extra predictable returns, whereas these targeted on mining stay uncovered to cryptocurrency volatility.
Bitcoin miners are reallocating cash and operational focus away from proof‑of‑work hashpower towards synthetic intelligence and excessive‑efficiency computing information facilities, as shrinking mining margins and halving‑pushed income pressures make conventional operations much less profitable.
Main publicly traded miners comparable to Bitfarms (now rebranded as Keel Infrastructure) and IREN have signaled full or partial exits from legacy mining to host AI workloads and safe lengthy‑time period contracts with cloud and hyperscaler companions.
