🌌 AI is Behind Galaxy's Strong Buy

Rittenhouse Research, a new firm specializing in fintech, AI, and crypto, has issued a "strong buy" rating for Galaxy Digital (GLXY), asserting that its strategic pivot from Bitcoin mining to AI data centers represents a significantly more lucrative business model.

This favorable outlook stems from Galaxy Digital's unanticipated acquisition of the Helios 800 MW datacenter in late 2022, which, unbeknownst to them then, would become a highly sought-after asset due to the explosion in demand for AI data center space.

Rittenhouse Research argues that AI data centers provide stable, long-term cash flows with minimal ongoing capital expenditures, a stark contrast to the inherent volatility and capital intensity of Bitcoin mining, which faces revenue declines due to halving events.

Unlike competitors who have retroactively claimed broader business intentions, Galaxy Digital's shift is seen as an accidental but highly successful transition, bolstered by its strong balance sheet and established credibility through a lease with CoreWeave.

The equity researcher writes: "While the majority of public miners are now talking about AI, Galaxy is the only name with both the financial and human capital required to pursue the opportunity presented. Galaxy was built as a profitable financial services and trading business, led by CEO and Founder who has grown book value per share from ~$1 to ~$6 since 2018. Meanwhile, Bitcoin miners continue to bleed cash and dilute their shareholders into oblivion."

Galaxy Digital has now fully exited Bitcoin mining to concentrate on its AI data center ambitions, a move that Rittenhouse Research believes positions it favorably with potential hyperscaler tenants, despite some concerns about CoreWeave's creditworthiness.”

🗞️ In the News

• HIVE has achieved a record 9.5 EH/s hashrate, exceeding 1% of the global network, and is on track to reach 25 EH/s by the end of 2025 through strategic expansion in Paraguay.

• Riot Platforms has upsized its credit facility with Coinbase to $200m, aiming to fund strategic initiatives and general corporate purposes with the same interest rate as the previous $100m facility.

• Sangha Renewables has broken ground on a 19.9 MW pilot project in West Texas, aiming to generate $42m in revenue within its first year by using surplus renewable energy to mine approximately 900 BTC over the next decade.

• Pakistan has established the Digital Asset Authority (PDAA) to regulate its rapidly growing crypto market, aiming to oversee digital asset operations, tokenize national assets, facilitate Bitcoin mining with surplus electricity, and attract global investment in financial innovation.

• Panama City's Mayor, Mayer Mizrachi, is teasing the creation of a city-level Bitcoin reserve after meeting with key Bitcoin policy advisors from El Salvador.

• DayDayCook, a consumer brand with operations in mainland China and Hong Kong, announced a plan to acquire 5,000 BTC as a reserve, starting with an initial purchase of 100 BTC.

🩺 Miner Q2

⛓️ DMG Blockchain

• DMG Blockchain Solutions reported $12.6m in revenue for Q2 2025, a 9% increase from Q1 2025 and a 26% increase YoY. Despite this, the company experienced a net loss and negative cash flow from operations, as it mined significantly more BTC than it sold.

• The company's average hashrate for Q2 2025 reached 1.76 EH/s, an 8% increase from the previous quarter and an 82% increase YoY, reflecting ongoing deployment of hydro direct-liquid-cooled miners.

• Total assets increased by 9% YoY to $129.5m, largely due to increased Bitcoin prices and short-term investments.

• Operating and maintenance expenses rose to $7.6m, primarily due to higher utility costs from expanded mining operations and new third-party hosting fees.

• General and administrative costs saw a slight increase to $1.9m, mainly driven by financing costs associated with the company's credit facility.

• As of March 31, 2025, DMG held 458.07 BTC and its total digital assets, cash, and short-term investments amounted to $61.9 m.

• Research costs increased by $122,232, focusing on software development for platforms like Systemic Trust, Helm, Reactor, and Blockseer Explorer.