Key Takeaways
- • Galaxy Digital converted a $65 million distressed Bitcoin mining asset (Helios facility, acquired in 2022) into a $4.5 billion AI infrastructure deal through an eight-year hosting agreement with CoreWeave, representing a 69x capital revaluation at $0.33/watt acquisition cost.
- • The Helios facility is now operational at full 800 MW approved capacity under CoreWeave's expansion options, with Galaxy expecting over $1 billion in average annual revenue across the contract term and lease-level EBITDA margins approaching 90%.
- • Galaxy's AI infrastructure business generates predictable, high-margin recurring revenue but remains undervalued by institutional investors who continue to perceive the company primarily as a crypto-focused investment bank rather than a pure-play data-center operator.
- • A potential spin-off of Galaxy's data-center division could unlock significant shareholder value by enabling valuation using traditional data-center multiples (typically higher than crypto-sector multiples), addressing what some investors view as a substantial valuation gap.
- • The Helios deal exemplifies broader industry trends as Bitcoin miners transition to AI infrastructure, with the sector taking on $70 billion in contracts amid margin compression in cryptocurrency mining operations.
Summary
Galaxy Digital's 2022 acquisition of the distressed Helios Bitcoin mining facility for $65 million has evolved into a transformational $4.5 billion AI infrastructure partnership. In 2025, Galaxy signed a 15-year lease with CoreWeave, a leading AI cloud provider backed by Nvidia, to convert the Texas-based facility into a high-performance computing data center. CoreWeave has since exercised expansion options to utilize the site's entire 800 MW approved power capacity, demonstrating strong demand for the infrastructure.
The asset conversion delivers compelling financial metrics for Galaxy. The company expects the facility to generate over $1 billion in average annual revenue annually across the contract term, with lease-level EBITDA margins approaching 90%—returns characteristic of premium infrastructure assets. This represents a 69x revaluation of the original $0.33/watt acquisition price, transforming what was positioned as a pandemic-era mining rescue into a cornerstone AI infrastructure asset.
Despite the operational and financial success of Helios, Galaxy's stock performance has significantly lagged comparable AI infrastructure and high-performance computing-focused companies. The persistent valuation gap stems from investor perception: the market continues to categorize Galaxy primarily as a crypto-focused investment bank engaged in trading, asset management, mining, and capital markets activities rather than recognizing it as a pure-play AI infrastructure operator. This identity crisis leaves Galaxy caught between two peer groups, each applying different valuation methodologies.
Some institutional investors view a potential spin-off of Galaxy's data-center division as a strategic catalyst. Separating the AI infrastructure business would allow the market to apply traditional data-center valuation multiples—typically higher than crypto-sector multiples—to the asset. With CoreWeave's first phase now operational and lease revenue flowing, a separation could provide clearer visibility into what proponents argue is a significant valuation gap between Galaxy's current trading levels and intrinsic infrastructure value.
The asset conversion delivers compelling financial metrics for Galaxy. The company expects the facility to generate over $1 billion in average annual revenue annually across the contract term, with lease-level EBITDA margins approaching 90%—returns characteristic of premium infrastructure assets. This represents a 69x revaluation of the original $0.33/watt acquisition price, transforming what was positioned as a pandemic-era mining rescue into a cornerstone AI infrastructure asset.
Despite the operational and financial success of Helios, Galaxy's stock performance has significantly lagged comparable AI infrastructure and high-performance computing-focused companies. The persistent valuation gap stems from investor perception: the market continues to categorize Galaxy primarily as a crypto-focused investment bank engaged in trading, asset management, mining, and capital markets activities rather than recognizing it as a pure-play AI infrastructure operator. This identity crisis leaves Galaxy caught between two peer groups, each applying different valuation methodologies.
Some institutional investors view a potential spin-off of Galaxy's data-center division as a strategic catalyst. Separating the AI infrastructure business would allow the market to apply traditional data-center valuation multiples—typically higher than crypto-sector multiples—to the asset. With CoreWeave's first phase now operational and lease revenue flowing, a separation could provide clearer visibility into what proponents argue is a significant valuation gap between Galaxy's current trading levels and intrinsic infrastructure value.
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