Bitcoin mining stocks have made a significant start to 2026, fueled by decreasing network competition and renewed interest in high-performance computing (HPC), according to a report from Wall Street bank JPMorgan. The report highlights that the 14 U.S.-listed bitcoin miners and data center operators the bank tracks collectively saw their market capitalization reach $60 billion by the end of January, marking a remarkable 23% increase month-over-month. This performance far exceeded the 1% gain of the S&P 500 during the same timeframe.
A major catalyst for this growth was Riot Platforms’ recently signed HPC agreement with AMD, focused on their expansive 700-megawatt facility in Rockdale, Texas. This collaboration is a clear indicator of bitcoin miners’ strategic shift towards diversifying their operations beyond traditional mining activities.
Amid challenges posed by record-low margins following the 2024 halving, many bitcoin miners are adjusting their business models to act as digital infrastructure providers. This includes repurposing their power-intensive mining facilities into AI-ready data centers, which aim to secure more stable and sustainable revenue streams.
Despite this positive adjustment, valuations in the sector have started to look increasingly stretched. Analysts Reginald Smith and Charles Pearce pointed out that mining stocks are currently trading at approximately 150% of the potential block reward opportunity over a four-year horizon, a valuation about three times higher than the average seen since 2022. This disparity underscores a growing disconnect between the market valuations of bitcoin miners and the actual price of bitcoin.
From an operational perspective, January provided a degree of relief for miners. Weather conditions, including winter storms across the U.S., led to widespread curtailments, which in turn decreased the average network hashrate by 6% month-over-month, down to 981 exahashes per second (EH/s). The hashrate briefly touched as low as 700 EH/s during the month, while mining difficulty experienced a 5% reduction from December and remained 10% below the all-time high set in November.
The hashrate serves as an important indicator of the overall computing power dedicated to mining and processing transactions within a proof-of-work blockchain, also acting as a proxy for competition in the market.
This decline in competition provided some cushion against falling bitcoin prices. JPMorgan’s analysts estimated that miners earned approximately $42,350 per EH/s in daily block reward revenue in January, reflecting a slight increase from December figures. Meanwhile, gross profit surged by 24% to around $21,200 per EH/s, thanks to improved network efficiency. Nonetheless, profitability still lags significantly behind levels seen prior to the halving.
Stock performance in the sector was predominantly positive, with twelve of the fourteen miners tracked by JPMorgan outperforming bitcoin’s 4% decline during January. Notably, IREN experienced a remarkable 42% increase in its stock value, while Cango saw an 18% decline. Despite the recent rally, the combined valuation of these mining stocks remains about 15% lower than the highs recorded in October 2025, indicating ongoing volatility in the market.
