The Pomp Podcast - Largest Bitcoin Miner Predicts Next Bitcoin Bull Run | Fred Thiel

Episode Date: February 12, 2026

Fred Thiel is the CEO of Marathon Digital and a leading voice at the intersection of bitcoin, energy, and data center infrastructure. This conversation was recorded live at Bitcoin Investor Week in New York. In this conversation, we discuss the growing energy constraints driven by AI and bitcoin, why powered land is becoming increasingly valuable, and how bitcoin miners are adapting by shifting toward AI. Fred also explains the impact of falling mining hardware costs, international expansion, and why long-term value will accrue to companies that control energy and infrastructure.======================Simple Mining makes Bitcoin mining simple and accessible for everyone. We offer a premium white glove hosting service, helping you maximize the profitability of Bitcoin mining. For more information on Simple Mining or to get started mining Bitcoin, visit https://www.simplemining.io/======================Arch Public is an agentic trading platform that automates the buying and selling of your preferred crypto strategies. Sign up today at https://www.archpublic.com and start your automated trading strategy for free. No catch. No hidden fees. Just smarter trading.======================0:00 - Intro0:19 - Is there enough energy for Bitcoin & AI?4:50 - Why mining hardware is cheaper than ever6:16 - The future of data centers & energy10:27 - How investors should think about bitcoin, AI, & energy15:03 - The biggest risk in infrastructure

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If you look at Bitcoin mining, it costs you a little over a million dollars a megawatt for infrastructure and miners. Infrastructure alone in the data center world is 12 million a megawatt. The amount of compute that is deployed today versus what will be deployed in five years, it's never getting shut off. And one word of warning from an investment perspective. All right. You run a very interesting business that has a lot of components and inputs. You have hardware, you have energy, you've got Bitcoin, you've got hash rate. I mean, you got a lot of stuff going on that you've got to figure out how the hell do I navigate all this stuff? Maybe a great place to start. Let's just start with the energy. Everywhere that I read

online, energy is not going to be enough availability for what we need because of AI and Bitcoin. Is that true? Yeah, I think if you look at the, you know, the big demand right now for energies from, obviously, the HPCAI sector. And they need energy that is on now and not on in 2029. And if you're trying to get access to 500 megawatts of power and you get in a queue, you're not going to get it anytime soon. So the hyperscalers are now very focused, as are the neoclouds, on looking at, okay, I don't need a one-gigawatt data center.

I need anything north of 100 megawatts, which has the ability to grow. And I need the power to be on already, because there are two issues that impact a hyperscaler's ability to bring capacity online, and realize the timing of when they bring their site online is more important than when it costs them to bring it online, because it's all about a capacity war. Who has GPUs running? It's not about necessarily the specific type of GPU, but it's who has stuff running, because Because the more stuff you have running, the smarter your model is, the more you can do.

So permitting is the second problem. So you may have the ability to take powered land and build a hyperscaler site on it. But if that county has a moratorium, won't allow you to build a big hyperscaler center. It's an issue. And I think what you're going to see now is a huge amount of innovation around what defines a data center and how they're built. is going to make it much more attractive for hyperscalers to talk to people like us who have, you know, over a gigawatt of power that's turned on and ready to go.

So a couple of things. Talk about how much power you guys have today. How much is Bitcoin mining versus turned on but not being used? So then how much is in development? So we have 1.1 gigawatts of power that's operating as Bitcoin mining today. We have another 700 megawatts of power that is unenergized, if you would, that is expansion capacity for that. And we have another couple of gigawatts of power in the pipeline behind that. A lot of our growth for Bitcoin mining is actually targeted internationally. And the reason why is, A, in the US, to get 100 megawatts of power, I have to find a hyperscaler or somebody who's trying to get it to a hyperscaler.

But internationally, there is much less demand for AI in hyperscaler capacity. You can go in lots of countries in the Middle East, you can go in countries in Europe, and a big site for them for AI is 40 megawatts. And so you have power dislocation economics happening around the world where you have places like Saudi Arabia where they have built huge amounts of power infrastructure

specifically to generate hydrogen and the hydrogen market isn't developing and so you have all this renewable energy that's available but isn't connected to a grid to be sold and there isn't a city anywhere nearby that is available that they now want to monetize you have countries like france where 66 of the energy is nuclear the rest is mostly renewable and the capacity of the nuclear power plants is running below 70 percent and so they have way excess energy but there it's a permanent issue but so i think you look at the business that we or our peers are in and i think you're going to see most of the u.s miners will do some portion if not all conversion towards aihpc domestically and those of us who operate internationally will continue to grow

bitcoin mining internationally where it's much more economically viable today than in the us is that bad for bitcoin like do we lose hash rate sorry is that bad for bitcoin and do we lose hash rate no i think listen the bitcoin blockchain is over secured right i mean we have way too many people mining bitcoin um you don't have enough transaction volume today to support the industry you go to the having in 2032 and a lot of miners are going to be worrying about what their business they should be in tariffs obviously have had a huge impact on people in the physical economy um some positive some negative you guys have hardware how do you in all the electrical components etc what are you guys seeing in your business um we operate in

a market where today the cost of uh a terahash of bitcoin mining capacity as that is at its lowest point most probably ever you know you can buy mining rigs today for eight nine dollars a a terahash. When go back to the peak in 2021, it was $80 a terahash for a much less efficient machine. What is driving that? That's tech innovation driving it down? It's a combination of oversupply and no demand. Think about it. 40% of miners in the US are the public miners. The vast majority of them have all said, we're going to do HPC or AI. They're not buying any more miners. You know, Bitmain has shut down what was going to be a U.S. assembly facility. They're trying to place machines anywhere they can to put them to work. Nobody

is buying Bitcoin miners because right now, unless Bitcoin price moves up, there's no profit margin in adding capacity. You're literally just taking money off the table from yourself. And so it's a perfect time to expand if you are wanting to expand somewhere. and it's a marketplace where really energy rules and you have to have energy and that drives everything you mentioned earlier innovation around data centers and what is considered a data center if you go to the extreme we've heard elon talk about like the self-driving car robo taxi you know kind of decentralized thing he is literally talking about now putting data centers in space to get away from the regulation on earth um is that what you're talking about or are you talking

about other versions. No, I mean, data centers in space, I don't know if any of you have ever built electronics that have to operate in space, but your average GPU will die a quick death from gamma radiation in space, and there's no way to service it. So I think it's a great Elon thing for him to focus on, build data centers on the moon. It's a moonshot type of project, which is perfect for him. Data center innovation is, you know, if you look at Bitcoin mining, it costs you a little over a million dollars a megawatt for infrastructure and miners. Infrastructure alone in the data center world is 12 million a megawatt. Add to that another 24 to 30 million dollars a megawatt for GPUs. That's a crazy cost.

Now, granted, great revenues. But if you can at least take the infrastructure down to a million dollars a megawatt and solve that problem through modularizing a data center and in the world of inference you don't need to have all these huge clusters that are interconnected i think you start seeing all of a sudden an ability to take advantage of power in all sorts of very interesting places and just to be fair you know revenue generation in the ai world is only done through inference that's what you pay for right you don't pay for training unless you're building models. Today's episode is brought to you by Simple Mining. Bitcoin mining has a reputation for being complicated, risky, and hard to evaluate as a real investment. If you're considering mining

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looking for these energy sources. I'm imagining that a very material amount of the capital from AI and Bitcoin is going into developing the energy source. And there are people trying to eat in, you know, vertically integrate. What are you seeing on that front in terms of, in a way, the data center providers, the AI, and the Bitcoin consumers are really now energy developers? Yeah, so again, it's all about time to energization of the data center. So if you're a hyperscaler, you have a certain amount of capacity you want to have online by the end of 2026, a certain amount by the end of 2027, 2028, 2029. As you get beyond 29, there you can look at, I'm going to go build my own power generation because that's going to take a couple of years to three years just to get permitting, et cetera.

Anybody look at Vernova or GE Power's recent or Siemens Power recent earnings releases, their orders are up 260%. The queues are 36 months to get equipment for generation. So building your own generation capacity is a long game. Right now, it's a capacity game. That's operational capacity because that's what drives market share. And so they are looking for very fast ways to get online. And that's more easily done by finding people that have power. And so the value of powered land goes up very high. How do you think about the difference in your business versus, you know, if I'm a public market investor and I'm looking, okay, I got a bunch of these companies I can go and invest in. There's some that are pure play Bitcoin miners. There's some that are kind of these hybrid AI and Bitcoin. And then obviously there's just pure AI, but then I can even go deep into the

energy stack. I can go into, you know, Jordy Vischer talks a lot about like memory and all these kinds of different components. What do I do? How do I think about this? And maybe what is differentiating about your business versus, you know, so many other options? Long-term value always accretes at the end, which is closest to the customer. In the historical software world, it was always software, application software. Hardware always commoditizes. You look at the internet build-out, you look at every single boom the industry has had, and I've worked in tech for 40 years.

How's that possible if you're only 21? I wish. That was many years ago. And so all the value accretes at the end. If you look at why software stocks are getting hit so hard, it's because all of a sudden companies like Anthropic are showing that, hey, you know what, that ERP system you have, it doesn't have as much value. The moat that SAP has is being eroded now by AI, because while you won't necessarily rip SAP out, you will, through agentic technologies, essentially generate the insights that the humans who would be operating SAP would have. So you're stripping off a whole value layer off the ERP stack, CRM, insurance, drug discovery, all these things. And these agentic frameworks, because of things like Claude, you can create them at insane speeds.

And so what's happening is the iterative speed of improvement and innovation that's happening is something that these large monolithic ERP and SaaS application vendors can't deal with because their systems aren't built that way. Right. And so if you look at this, it is going to be two and three man companies that build a genetic frameworks for specific applications. And it's going to be a fly in the pan because that company is going to be popular for about six to 12 months. And then somebody is going to come right around and eat them. And you're going to have huge volatility in the sector for the next five to 10 years. So what should people do? I think you need to be really smart about looking at what is the, you know, the long piece, the long pole, if you would, in the tent. Energy is a core part, but, you know, energy utilities are energy utilities.

They're kind of boring. But you want to look at companies that control energy and infrastructure, because while people may say there is a bubble in AI, by the way, the amount of compute that is deployed today versus what will be deployed in five years. it's never getting shut off and so you've got long-term good renewable recurring revenues there if you want more volatility go further up the stack now when i see people online talking about the ai bubble i think that there's a lot of folks who are like hey we're building all this stuff out they worry about regulation that oh electricity prices are spiking in certain areas but i also see this whole idea of like this is classic you know silicon valley we make a bunch of cool stuff but doesn't actually improve anyone's life i think i use it every day if i pulled the audience i think they use it every day so i'm assuming that that's probably not going to resonate but how do

you think about some of the regulatory stuff that you guys have been dealing with for a long time right there's less noise there was pollution there was whatever now it's electricity prices seem to be the the big thing yeah so it's either noise water or electrical prices right those are the three typical things and nimbism they don't want data centers in their backyard anybody here who lives in Loudoun County, North Virginia. It's a place that's kind of, you know, a field of data centers, right? People don't want that in their backyard. They don't want higher electrical prices. And so the president's talking about doing a pact between the data center operators and the utilities so that the data centers may pay higher prices. It's really about becoming

more efficient energy operators. If you think about what Bitcoin miners have had to do, We have been constantly chasing a need to have lower and lower and lower cost to produce what we do and become more and more energy efficient. And the industry energy is a pittance of the total cost of what they have to do. Right. Their cost is all capex around the equipment. As you start seeing a shift towards more basic based compute, that's lower cost.

And as you start seeing an ability to um abstract the model from the hardware layer so you can orchestrate ai workloads across the cheapest operating hardware wherever it's needed so that you get the quality of service on the delivery of your task within the time frame you need you'll do that and that will drive cost down because this industry the ai industry has already commoditized around this thing called cost of a token and more importantly um you know how much inference do you get per megawatt and so it's already commoditizing and so there's this whole price curve that people are going to have to chase down and one word of warning from an investment perspective

there's a huge obsolescence curve in ai that is a three-pronged or a three-line curve in In Bitcoin mining, we have one curve, and that's ASICs. And the fact that we have a halving, that drives us to use more and more efficient ASICs. Those ASICs all plug into the same racks. They use the same power. And they use the same cooling. Biggest complaint that NVIDIA customers have is,

I put in H100s, now I'm going to put in Blackwells. I have to retrofit all my racking, all my power, all my cooling. so now think about a company that just signed a lease with a hyperscaler where they are putting in the equipment not the hyperscaler and in three years that hyperscaler is going to say you know what you need to rip that out and put the next generation of stuff in there the company hasn't even paid off this equipment so i think you're going to see a lot of blow-ups amongst people who have gone out and kind of are renting bare metal to the hyperscalers versus people who are building powered land

and then leasing it to the hyperscaler and the hyperscaler takes all the CapEx risk. Those are the long-term. The people who are in the real estate business are going to be the long-term winners because the people who are putting bare metal and renting bare metal have to bear this obsolescence cost.

And nobody can. I don't think energy is going anywhere and I think you're in a pretty good business. Fred Thiel, everybody. Thank you. Thank you.