In March, publicly listed Bitcoin mining company Cango Inc. successfully reduced its average production cost per BTC by 19.3%, from $84,552 in the last quarter of the previous year to $68,216. This was achieved through strategic fleet optimization rather than expansion.
The firm decommissioned older mining hardware and moved operations to areas with more affordable electricity costs. Additionally, it sold 2,000 Bitcoin during the month to retire crypto-backed debt, which is currently valued at approximately $143 million. The proceeds were used to reduce its outstanding loan balances to $30.6 million.
As of March 31, Cango retained 1,025.69 BTC in its treasury, worth over $73 million at current prices. The company’s total hash rate was 37.01 EH/s by the end of March, comprising 27.98 EH/s from self-mining and 9.02 EH/s from leasing arrangements.
The operational restructuring went beyond mere downsizing. In areas with high hosting costs, Cango implemented hash rate leasing models to maintain revenue without incurring full operational expenses, as per their announcement.
Cango intends to reinvest capital saved from its deleveraging efforts into AI computing infrastructure, viewing the cost reductions as groundwork for expanding its business model. The company sees AI infrastructure as a logical extension of its existing investments in power and facilities.
This focus on efficiency mirrors changing priorities among public Bitcoin miners amid slimmed margins and market volatility. Instead of focusing solely on hash rate growth, companies are now exploring unit economics and alternative revenue streams. Several firms have ventured into powering AI computing needs, sometimes shifting away from their original business models to pursue greater profits in the AI boom.
Cango’s restructuring aligns with similar industry trends. MARA recently sold $1.1 billion in Bitcoin to repurchase convertible debt while reducing its workforce by 15%. Core Scientific has considered selling all its Bitcoin holdings to fund an AI transition, and Cipher Digital shifted focus to data center operations through a 15-year infrastructure deal, signaling the industry’s evolution beyond traditional mining.
Cango shares (CANG) ended Wednesday’s trading session up 3.3% at $0.4291 amid a generally positive stock market day following a conditional ceasefire between the U.S. and Iran. However, CANG shares have declined nearly 39% over the past month.