American Bitcoin, a Bitcoin (BTC-USD) mining and treasury company co-founded by Eric Trump, has come under heavy pressure as Bitcoin's downturn and the surge in artificial intelligence demand have reshaped investor appetite across the mining sector. The company's shares have fallen more than 95% from their peak, erasing over $600 million from the market value of Eric Trump's stake over the past 10 months, according to Bloomberg calculations. The pressure also pushed American Bitcoin into a 1-for-15 reverse stock split this week to help maintain its Nasdaq listing, while the stock touched an all-time low on Wednesday.
Investors appear to be favoring miners with more flexibility to shift power, land and computing infrastructure toward AI-focused data centers. Riot Platforms, a U.S.-based Bitcoin mining company, Cipher Digital, a U.S.-based Bitcoin miner expanding into data centers, MARA Holdings NASDAQ:MARA, a U.S.-based digital asset mining company, and TeraWulf NASDAQ:WULF, a U.S.-based Bitcoin miner moving into data-center opportunities, have all announced data-center expansion plans and their shares are up more than 60% on average this year. American Bitcoin, by contrast, has remained focused on mining and accumulating Bitcoin, while Hut 8, a company providing American Bitcoin's mining rigs, power, sites, hosting infrastructure and day-to-day operations, has leaned further into power infrastructure and multibillion-dollar AI data-center leases.
American Bitcoin's strategy may still appeal to investors who expect Bitcoin to rebound from current levels, especially after the company added another 500 Bitcoin on Monday and crossed the 8,000 BTC mark. However, the model remains highly exposed to crypto prices, as shown by the company's $118.2 million first-quarter operating loss, which included a $117.2 million markdown on its Bitcoin treasury. Benchmark analyst Mark Palmer noted that American Bitcoin appears well positioned in terms of fleet efficiency, fleet size and Bitcoin production capacity, but the key issue is that Bitcoin's price needs to rise for the business model to work.