Bitcoin Miners Squeeze Profits as Japan’s Largest Utility Joins the Hash Race

Bitcoin mining profitability sits near all-time lows in mid-September 2024, battered by a post-halving squeeze that shows no sign of easing. Yet even as margins compress, new entrants — including Japan’s largest electric utility — are diving in, betting that the economics of surplus energy and scale will carry the day.

TL;DR

• JPMorgan reports Bitcoin mining hashprice remains more than 50% below pre-halving levels, with U.S.-listed miner market caps slipping 3% in early September.
• TEPCO, Japan’s largest power company, begins mining Bitcoin through subsidiary Agile Energy X using surplus renewable energy from solar farms in Gunma and Tochigi prefectures.
• MARA (Marathon Digital) pushes its energized hashrate to 36.9 EH/s, a 5% month-over-month increase, mining 705 BTC in September and holding 26,842 BTC on its balance sheet.
• Core Scientific completes ASIC miner migration from two data centers earmarked for HPC/AI conversion, signaling the growing overlap between Bitcoin mining and high-performance computing.
• Kiln launches “Widget” on September 12, a no-code staking integration tool, as institutional Ethereum staking infrastructure continues to mature.

TEPCO Turns Waste Energy Into Bitcoin

In what marks one of the most significant energy-Bitcoin crossover stories of the year, Tokyo Electric Power Company (TEPCO) — Japan’s largest electricity provider serving over 27 million customers — has officially entered the Bitcoin mining space. Through its subsidiary Agile Energy X, established in 2022, TEPCO installs mining rigs adjacent to solar farms in the Gunma and Tochigi prefectures near Tokyo.

The logic is straightforward: Japan curtails approximately 1,920 gigawatt-hours of renewable energy annually because grid supply outpaces demand. Solar and wind farms are forced to throttle production to prevent overloading transmission lines. Agile Energy X redirects this surplus to Bitcoin mining rigs that would otherwise sit idle.

Agile Energy X President Kenji Tateiwa frames the initiative as a catalyst for renewable energy investment. “Green energy producers have to operate their businesses on the assumption that part of the power they generate is wasted,” Tateiwa tells Asahi Shimbun. “If bitcoins were to provide a new source of income for similar power producers, who are being exposed to overinvestments, that would prompt more green energy to be introduced.”

The company estimates the opportunity is massive. If Japan achieves its target of renewables supplying 50–60% of total power by 2050 — part of the national carbon neutrality push — up to 240,000 gigawatt-hours could go to waste each year. Redirecting even 10% of that excess toward Bitcoin mining could generate approximately $2.5 billion (360 billion yen) annually.

Profitability Pain Persists After April Halving

While new players enter the market, existing miners are still reeling from the April 2024 halving, which cut block rewards from 6.25 BTC to 3.125 BTC. A JPMorgan research report published on September 16 confirms that the Bitcoin hashprice — the key metric measuring daily miner profitability per terahash — remains more than 50% below pre-halving levels and fell an additional 2% in the first half of September.

The Bitcoin network hashrate has risen 4% month-to-date, returning to pre-halving levels near 89–90 trillion difficulty, which means miners are competing just as hard for half the reward. The total market capitalization of the fourteen U.S.-listed Bitcoin miners tracked by JPMorgan dipped 3% from the end of August to just under $20 billion. Jefferies echoed the caution, warning that September could be another difficult month for the sector.

Notably, however, U.S.-listed miners’ share of the global network hashrate climbed to a record 26.7% — the fifth consecutive month of gains — indicating that public companies with access to capital markets are consolidating market share even as smaller, less efficient operators struggle.

Marathon Digital Scales Aggressively

MARA (NASDAQ: MARA), the world’s largest publicly traded Bitcoin miner, demonstrates the “scale or die” mentality gripping the industry. The company reported September production of 705 BTC, a 5% increase from August’s 673 BTC. Its energized hashrate grew 5% to 36.9 EH/s, with 207 blocks won during the month — a 6% improvement.

CEO Fred Thiel says the company remains on track to reach its 50 EH/s target by the end of 2024, driven by rapid energization of owned sites and operational efficiency gains. MARA’s conversion of its Granbury, Texas data center from air-cooled to immersion cooling containers is progressing on schedule, with completion expected before year-end.

In a notable strategic move, MARA sold zero Bitcoin in September, adding all 705 mined BTC to its treasury. The company now holds 26,842 unrestricted BTC on its balance sheet — roughly one “marathon” worth of Bitcoin, as Thiel characterized it. MARA also became the first publicly traded digital asset compute company to submit a disclosure to the Climate Disclosure Project (CDP), signaling a push toward environmental transparency.

Core Scientific Pivots Infrastructure Toward AI

Core Scientific (NASDAQ: CORZ) presents a different strategic response to the post-halving crunch: diversification into high-performance computing. The company mined 345 Bitcoin in September, down from 358 in August, but the decline reflects a deliberate shift in infrastructure rather than operational struggles.

In September, Core Scientific completed the migration of all ASIC miners from two Bitcoin mining data centers designated for HPC conversion. The team is now removing cabling, power distribution units, racks, and other mining infrastructure to prepare the facilities for AI and GPU cloud workloads. The company’s customer-funded project targets nearly 400 megawatts of digital infrastructure for high-performance computing, with powered infrastructure equipped with advanced liquid cooling systems scheduled for delivery in the first half of 2025.

Core Scientific also resumed work on a substation in Muskogee, Oklahoma, to support a planned 100-megawatt data center, while remaining on schedule to finalize a 100-megawatt expansion of its Pecos, Texas mining facility. The company returned 45,262 megawatt-hours to local electrical grids through economic curtailments, over-temperature events, and load response programs.

Kiln Launches No-Code Staking Widget

On the staking side of the industry, institutional infrastructure provider Kiln launched its “Widget” product on September 12 — a no-code solution that enables crypto platforms to create and manage staking “Earn” sections for their users in days rather than months. The Paris-based company, which powers staking for clients including Ledger, Bitpanda, Fireblocks, and BitGo, positions the Widget as a way to eliminate the front-end engineering bottleneck that slows staking integration.

Kiln’s launch underscores the accelerating institutionalization of Ethereum staking. The company supports more than 30 proof-of-stake networks and counts over $18 billion in assets under stake. The Widget arrives as the Ethereum staking ecosystem matures post-Merge, with major financial institutions exploring staking-as-a-service offerings for their clients.

Why This Matters

The juxtaposition of crashing profitability and expanding infrastructure tells you everything about where Bitcoin mining is headed. The April 2024 halving cut miner revenue in half overnight, and yet the network hashrate is already back to pre-halving levels. The miners surviving this shakeout are the ones with access to cheap capital, cheap energy, or both.

TEPCO’s entry is particularly significant. When Japan’s largest utility — a company that serves over 27 million customers — decides Bitcoin mining is a viable use case for surplus renewable energy, it validates a thesis that the crypto industry has argued for years: mining can be a flexible load that improves the economics of clean energy infrastructure. If TEPCO’s $2.5 billion annual revenue estimate for wasted energy proves directionally correct, expect more utilities worldwide to follow.

The parallel expansion into HPC and AI by companies like Core Scientific reveals the next chapter. Bitcoin mining data centers are, at their core, large-scale energy infrastructure with advanced cooling and power systems — exactly what AI compute demands. Miners that can repurpose their facilities for the AI boom are creating a hedge against Bitcoin price volatility while tapping into the fastest-growing segment of the tech industry.

For investors and industry observers, the picture is clear: the era of small-scale, speculative Bitcoin mining is ending. What replaces it is professionalized, energy-optimized, multi-use digital infrastructure — run by publicly traded companies, major utilities, and institutions with the balance sheets to weather prolonged margin compression.

Disclaimer: This article is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency mining and staking involve significant risks, including the potential loss of capital. Always conduct your own research and consult with a qualified financial advisor before making investment decisions. Past performance is not indicative of future results.