Galaxy Digital surges 68% as AI data center business drives revaluation

Wall Street is valuing Galaxy Digital more for its Texas power capacity than its crypto holdings, marking a shift in how digital asset firms are assessed.

Galaxy Digital shares rose 68% to about $33.50 by mid-June as investors focused on the company's Helios AI data center campus in Texas, not its crypto trading revenue.

"Galaxy is effectively becoming an AI infrastructure company that also happens to have a crypto business," a Wall Street analyst who rates the stock a buy said. Ten of 12 analysts covering Galaxy rate it a buy, with an average 12-month price target of $39.50, implying 18% upside from current levels.

The company delivered the first 133-megawatt data hall at its Helios campus in Dickens County, Texas, to AI cloud provider CoreWeave in April under a long-term lease agreement. Galaxy secured approval from the Electric Reliability Council of Texas for an additional 830 megawatts and said the site could eventually reach 3.5 gigawatts of capacity, supporting more than $1 billion in annual revenue. The company closed a $1.4 billion project financing facility to accelerate the buildout.

The shift marks a broader revaluation of crypto firms that control power, land and grid connections — assets that have become scarce as AI companies compete for computing capacity. Galaxy reported a first-quarter net loss of $216 million, narrower than the $482 million loss in the prior quarter, and held $2.6 billion in cash. The company spent $65 million repurchasing 3.2 million shares in the first quarter.

The Helios site was originally a Bitcoin mining facility that Galaxy acquired from Argo Blockchain during the 2022 crypto downturn. The company has since repositioned the campus for high-performance computing and AI workloads, signing multi-year hosting agreements with CoreWeave that provide recurring revenue streams less dependent on digital asset price swings.

Galaxy is also expanding its Texas footprint beyond Helios. The company received city council approval this week for Project Merlin, a more than $400 million data center development on about 500 acres in McGregor, Texas. Galaxy said it would fund all power infrastructure upgrades, including building its own electrical substation, and use closed-loop cooling systems to cap water usage at about 3,000 gallons per day per building.

The strategy has attracted support from Wall Street even as Bitcoin has fallen from its October 2025 peak. Galaxy's stock climbed from roughly $20 in early February to about $33.50 by mid-June, outperforming many digital assets over the same period.

The trend extends beyond Galaxy. Several crypto mining and digital infrastructure companies across North America have begun pursuing opportunities in AI hosting, cloud services and high-performance data center operations, according to Reuters. Applied Digital signed a $5.2 billion AI data center lease with a US hyperscaler in June, showing the demand for computing capacity.

For investors, the revaluation raises questions about how to classify these hybrid companies. A firm that controls hundreds of megawatts of power capacity may warrant a different valuation approach than one dependent mainly on trading revenue. Long-term AI infrastructure contracts can create steady cash flows that are easier to forecast than income from crypto trading, potentially commanding higher valuation multiples.

This article is for informational purposes only and does not constitute investment advice.