Morgan Stanley Elevates Cipher Mining and TeraWulf, Flags Marathon as Less Attractive

Morgan Stanley’s inaugural coverage of three U.S.-listed bitcoin miners reframes parts of the group as potential infrastructure owners rather than pure commodity-exposed operators. The research rewards companies that have built leasable data-center capacity with higher targets, arguing that long-term contracts should attract infrastructure capital and lower sensitivity to bitcoin price swings. Cipher Mining and TeraWulf were highlighted for their ability to monetize physical campuses through third-party leases; the bank attached meaningful upside to those names and the call produced notable intraday share gains. Conversely, Marathon received a guarded assessment because its valuation remains heavily tied to bitcoin exposure rather than third-party leasebook growth. The Morgan Stanley team formalized conversion economics for TeraWulf using a present-value-per-watt framework and applied scenario success rates to model how much planned capacity could realistically be leased. That exercise was benchmarked against established data-center REITs to illustrate a potential valuation gulf if miners secure contracted cash flows, while acknowledging that scale and diversification differences should keep REIT multiples out of reach. The coverage arrives as sector fundamentals have softened modestly — the network’s seven-day average hashrate recently eased below 1,000 exahash with intramonth troughs near ~700 EH/s and mining difficulty has edged down (roughly 156t → ~146.5t) — a near-term relief that lifts block-reward revenue and helps cash generation. At the same time, hyperscaler capex and a wave of AI/HPC demand are creating a tangible market for converted megawatts, which supports the bank’s infrastructure narrative but also exposes miners to external constraints. JPMorgan and others have noted commercial frictions that can slow conversions, including accelerator supply tightness, OEM/backlog issues, local permitting delays and the need for firmed, 24/7 power solutions — factors Morgan Stanley flags as execution risks. The combined market backdrop — improving mining revenue dynamics plus outsized hyperscaler demand and recent investor rotation into infrastructure-like assets — partially explains why some miners have re-rated above on-chain economics. However, Morgan Stanley cautions that the re-pricing depends on demonstrable tenant signings, counterparty creditworthiness, equipment delivery and project financing. For investors, the note elevates leasebook size and counterparty quality as central valuation levers and suggests a bifurcation: conversion-capable operators may earn infrastructure-style multiples if they execute, while pure miners remain beholden to bitcoin volatility. The bank’s entry provides a concrete analytic playbook for distinguishing balance-sheet optionality across the sector and sets specific targets and assumptions investors can test against future leasing outcomes.