Compass Point: Bitcoin miners pivoting to AI are undervalued

U.S. investment bank Compass Point argued in a report that the value of Bitcoin mining companies is now being driven by artificial intelligence (AI) contracts rather than crypto, and that these firms are currently undervalued, CoinDesk reported. The bank suggested that miners transitioning into AI data centers should be assessed like landlords generating rental income, not by metrics tied to cryptocurrency prices. Compass Point identified Applied Digital (APLD), TeraWulf (WULF), and Cipher Digital (CIFR) as undervalued, noting that the market assigns little to no value to their unleased capacity despite its potential to generate significant rental income. The report explained that the next two years will be a turning point as these companies shift from announcing AI infrastructure deals to actual construction. Once projects are complete and rent payments begin, investors will gain a clearer view of the sustainable cash flow these facilities can produce.