Author: Nancy, PANews

The next battleground for AI computing power is extending into space, gradually becoming a new direction for business narratives.

Following the successful launch of the first space AI server, a space computing startup recently plans to send Bitcoin mining into outer space.

The plan to mine Bitcoin in space this year may have more symbolic significance than practical value.

Having moved beyond the initial phase of competing on chips and models, the competition for AI computing power has quietly shifted to a battle for energy. Electricity, as the core resource in this competition, is rapidly becoming a scarce resource in the global race for computing power. This shift is not only changing the industry landscape but also directly reshaping the cost structure of the Bitcoin mining industry.

In particular, Bitcoin miners who used to operate with a steady and pragmatic approach are now turning their attention to the AI computing power sector. Behind this transformation are the survival pressures brought about by Bitcoin halvings, the profit compression caused by increased competition and rising energy costs, and the huge opportunities presented by the AI narrative.

As the profitability of Bitcoin mining is squeezed by the global energy competition, Starcloud has proposed a bold plan to move Bitcoin mining into space.

In a recent interview with HyperChange, Starcloud CEO Philip Johnston revealed that the company is currently focused on its existing space computing business, while also having plans for Bitcoin mining. Starcloud will carry ASIC hardware specifically designed for Bitcoin mining on its Starcloud-2 satellite, which is scheduled for launch later in 2026. If successful, Starcloud will become the world's first spacecraft to mine Bitcoin in space.

Johnston believes that space possesses several natural advantages over Earth. First, space has an unlimited and continuous supply of solar energy, which is more stable and cheaper than renewable energy sources on Earth. Second, the superior environment in space, while characterized by extreme temperature differences and radiation, significantly reduces the energy consumption for hardware cooling, lowering cooling costs and reducing equipment maintenance burdens. Most importantly, Bitcoin mining in space can circumvent Earth's increasingly strained energy bottlenecks, grid restrictions, and regulatory pressures. Currently, approximately 20GW of electricity is used for Bitcoin mining on Earth, a scale that is no longer feasible on the ground. However, in space, utilizing cheap solar energy provides a completely new solution for Bitcoin mining.

Johnston added that the cost of Bitcoin mining equipment typically ranges from $600 to several thousand dollars, far lower than Nvidia's enterprise-grade GPUs (which usually cost over $30,000). This makes space-based Bitcoin mining extremely attractive economically.

Starcloud views Bitcoin mining in space as a "business of the future," utilizing cheap energy from solar power in space, and states that this is one of the reasons it and other companies (including SpaceX) are building data centers in space. Space mining can not only significantly reduce costs but also provide a completely new resource acquisition model for the global computing power market.

The concept of space mining is not new. Last year, Intercosmic Energy also stated that it was researching Bitcoin mining in space.

However, mining Bitcoin in space still faces many challenges. Johnston also acknowledged that the economics of Bitcoin mining in space remain unstable. Currently, Bitcoin ASIC devices can operate from any cheap energy source, but as new devices are constantly introduced, the profitability of mining equipment may decline rapidly.

Moreover, although launch costs have decreased year by year, sending hardware into space remains an expensive task. Compared to ground-based mining operations, the start-up and maintenance costs of space mining are still relatively high, including expenses for launch, spacecraft integration, satellite communications, equipment upgrades, and more.

Even more challenging is the extremely demanding hardware requirements of the space environment. ASIC devices for Bitcoin mining need to operate stably under extreme conditions such as high radiation and extreme temperature variations, posing a severe test to their performance and lifespan. Maintenance and upgrades will also be a major challenge, as the cost and difficulty of repairing and replacing hardware will increase significantly in the event of a malfunction.

Previously, many crypto-industry organizations had already explored bringing blockchain commerce to space. For example, Blockstream, a veteran company in the Bitcoin community, began leasing multiple geostationary satellites in 2017 to broadcast Bitcoin blockchain data globally for free. Even in the event of a large-scale internet outage on Earth (such as a natural disaster or man-made blockade), as long as you have a small satellite dish (receiver), you can synchronize the Bitcoin ledger and complete transactions. SpaceChain installed its first commercial Ethereum node on the International Space Station (ISS) as early as 2019. Earlier this year, Spacecoin, a new project focusing on space commerce, also attracted market attention, using satellite networks to realize cryptocurrency payment and settlement.

Therefore, mining in space may require far more investment than returns in the short term. Currently, it is more of a symbolic endeavor, or rather, a narrative tool for this startup to attract market attention.

For the first time in human history, Nvidia's AI server has been sent into space.

Founded in 2024, Starcloud, formerly known as Lumen Orbit, has already made a name for itself in the global technology industry and is one of the first companies to propose building data centers in space.

As a member of NVIDIA's Accelerator Program and a project of Y Combinator and Google Cloud Incubator, Starcloud is not simply about moving data centers into space. Its goal is to leverage the unique resources of the space environment to build infrastructure capable of supporting AI computing and large-scale computing.

Starcloud has completed at least $21 million in funding, backed by well-known investment institutions such as NFX, Y Combinator, FUSE, Soma Capital, a16z, and Sequoia Capital.

Starcloud has secured a place in the space AI computing power race. Last November, Starcloud completed the first-ever training of a large-scale space orbital model. It launched its own Starcloud-1 satellite via a SpaceX Falcon 9 rocket, sending an NVIDIA H100 GPU into Earth orbit and successfully running Google's open-source AI model Gemma, sending the first message from space back to Earth: "Hello, Earthlings!"

At the time, Philip Johnston stated that space AI was not a gimmick, and the company's goal was to achieve an energy cost for orbital data centers that was 10 times lower than that for ground-based data centers.

Having achieved initial success, Starcloud's ambitions haven't stopped. Recently, the company submitted an application to the FCC, planning to deploy a massive constellation of 88,000 satellites to build a distributed, space-based AI training and cloud computing platform. However, turning this vision into reality is fraught with enormous challenges. From funding and regulatory approvals to launch capacity, orbital resource allocation, and operational sustainability, this is not only a commercial race but also a systemic engineering challenge, with each step fraught with uncertainty and complexity.

Beyond Starcloud, as the AI industry's demand for computing resources continues to grow, more and more tech companies are seeking new sources of computing power, with space gradually becoming the focus of this competition. For example, Google officially launched Project SolarCatch at the end of last year, announcing that it would send its self-developed TPU AI chip into space, aiming to build a prototype space data center powered by solar energy; not long ago, Musk's SpaceX submitted an application to deploy 1 million satellites in Earth orbit to build an orbital data center; and recently, data storage and disaster recovery company Lonestar and semiconductor and storage company Phiso launched a data center infrastructure to the moon via a SpaceX rocket.

As the concept of space data centers moves from science fiction to reality, a new infrastructure arms race is underway. Musk predicts that in five years, space AI will add hundreds of gigawatts of computing power annually; the computing power of AI sent into space each year will exceed the total historical accumulation of all AI on Earth.

By then, the main battleground for AI computing power will truly shift to space. In the coming years, we will see more commercial exploration and technological innovation, and space mining may just be one of the stepping stones in this wave.

BitFuFu produced 214 bitcoins in March, reducing its holdings to 1794 bitcoins.

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