As concerns grow that the artificial intelligence (AI) bubble may have burst, Wall Street’s dealmaking continues due to a core issue: bitcoin miners and data center developers still demand substantial power.
“M&A activity is still active because there’s a persistent need for power,” stated Joe Nardini, head of investment banking at B. Riley Securities, during a conversation with CoinDesk.
Nardini indicated that the need for power from bitcoin miners remains “significant,” adding that the demand from AI and high-performance computing (HPC) is “even greater,” with data center and mining clients reporting sustained interest in GPU-ready facilities.
After the bitcoin halving decreased rewards, miners encountered a major margin squeeze, even with prices hovering around or above $100,000, leading to a shift towards accommodating AI and HPC hardware within their existing data centers. This transition has contributed to sharp increases in certain BTC mining stock values this year as AI excitement surged across the market.
Read more: GPU Gold Rush: Why Bitcoin Miners Are Powering AI’s Expansion
Earlier in 2025, growing anxieties about artificial intelligence and inflated valuations wiped away considerable market value from leading tech entities, including Nvidia (NVDA) and other companies benefiting from AI, as investors took profits and reassessed whether market prices had surpassed fundamental values.
CoreWeave (CRWV), an AI infrastructure specialist, also saw a decline, now resting over 50% below its peak in June.
Does this indicate the end of the AI trend? Nardini disagrees, supporting his rationale with a simple query for executives: Do clients require the data center capacity they’ve established? “Yes.” Do they have tenants? “Yes.” Are those tenants reliable? “Yes.” Are they achieving satisfactory rates? “Yes.” Nardini shared that the feedback remains consistent across multiple discussions: “Thus, the demand is still present.”
Indeed, Hut 8 shares surged by as much as 20% last week after establishing a 15-year, $7 billion lease with Fluidstack for 245 megawatts of IT capacity at its River Bend campus.
“In spite of the recent downturn, these companies continue to be rewarded with elevated valuation multiples and the ability to secure capital under appealing valuations and terms,” he stated.
Inside the dealmaking
This demand is still supporting valuations and increasingly influencing M&A discussions, according to Nardini.
In competitive scenarios with high-quality power and viable sites, Nardini noted that dollars per megawatt (a financial metric representing the value of each megawatt of electricity) can appear “very appealing.” One process involved evaluating a valuation exceeding $400,000 per megawatt, potentially reaching $450,000 per megawatt, depending on the negotiation outcomes. He has observed previous deals priced as high as $500,000 to $550,000 per megawatt.
However, the interest in distressed or less desirable locations persists, attracting “lowball” offers sometimes ranging from $100,000 to $250,000 per megawatt, as buyers appreciate the power but undervalue the market or property quality.
So, who are these buyers and sellers?
Nardini explained that buyers include hyperscalers (large tech companies providing cloud computing infrastructure), AI enterprises, and bitcoin miners, while the seller landscape has broadened beyond crypto-native entities.
He has observed dealmaking processes involving aging industrial facilities, including a 160-year-old site, where power remains the primary draw, despite the market not being favorable. In another instance, a private seller of a similar asset attracted interest from about 25 potential buyers seeking NDAs, including bitcoin miners, hyperscalers, and AI companies.
This situation is presenting an atypical strategic choice for asset owners: either sell to a hyperscaler or developer, or attempt to transform into a developer themselves.
Nardini has noted industrial firms with older, dormant, or near-dormant facilities that have power contemplating selling into the AI/HPC and Bitcoin ecosystem.
He mentioned another instance of a private client revitalizing older office structures into modular power capacity, “constructing 30 megawatt units at a time,” and currently seeking extra funding to scale up.
In at least one discussion, he noted a tenant was ready to prepay rent before completion, illustrating, in his opinion, how scarce desirable capacity remains.
No need to worry, yet
Looking ahead to 2026, Nardini believes the circumstances still favor risk assets if rates decrease, suggesting a potentially “risk-on environment,” which could benefit dealmaking in his sector.
He admits he might be “advancing his interests,” but the operational realities he’s gathering from executives keep him optimistic: tenants are present, pricing remains robust, and if one client opts out, “another will step in.”
His simple caution regarding the positive outlook is: if developers fail to lease their constructions, or cannot obtain the necessary price, that would be the moment for concern. Currently, he reports not hearing such sentiments. “The fundamentals of the business remain solid,” he affirmed.
He concluded with a straightforward evaluation of the sentiment.
“The demand for power and AI HPC data center capacity persists with no signs of decline. Developers with data center capacity are receiving interest from multiple reliable tenants at favorable rates, preserving the core economics of business.”
Nardini highlighted that buyers remain eager for energy, and sellers are experiencing favorable valuations for their assets. This further strengthens his confidence.
“The AI trend continues to thrive as of Dec. 17, 2025,” he asserted.
Read more: Amazon Enters AI Arms Race as Crypto and Risk Asset Fears Mount
