Galaxy Digital shares fell 8% to $20.86 after announcing a 500-acre AI data center in Texas. The $130 million tax revenue commitment and 74 MW initial capacity face execution risks.
Galaxy Digital shares slid 8.08% to $20.86 on Thursday. The decline followed an announcement that the company will build a second Texas data center on roughly 500 acres in McGregor, McLennan County.
The facility starts with 74 megawatts of capacity. Galaxy plans to scale it to several hundred megawatts by 2030. The company will build a dedicated substation and guarantee utility upgrades so local ratepayers do not absorb costs. Galaxy expects the facility to contribute at least $130 million in property tax revenue to McGregor over its life.
Construction will create hundreds of temporary jobs before permanent operational roles begin. Galaxy already operates the Helios campus in Dickens County, which now has over 1.6 gigawatts of ERCOT-approved power allocation and is leased to CoreWeave under a long-term agreement. Helios also marked Galaxy's pivot from bitcoin mining toward AI infrastructure.
The McGregor project adds to Galaxy's capital needs. Recent reports said the firm is pursuing roughly $3.5 billion in high-yield debt to fund Helios's second expansion phase tied to the CoreWeave partnership. Galaxy has not disclosed a specific financing plan for McGregor. The bond sale will test Galaxy's ability to fund both campuses.
Power delivery is scheduled for 2028, contingent on transmission upgrades. Any delay in utility approvals or grid interconnection could push the timeline. Galaxy faces community scrutiny over water use and noise, which have drawn opposition in other Texas towns. The company said it will use a closed-loop cooling system similar to Helios to minimize consumption, and it has pledged to fund any additional water infrastructure needed.
The AI infrastructure buildout continues to attract heavy investment. Core Scientific disclosed that AMD will use over 500 megawatts of computing capacity starting in 2027, with potential expansion to 2.5 gigawatts. Separately, reports emerged that Nvidia executed leases valued at up to $50 billion for Hut 8's Beacon Point Texas campus. Galaxy's multi-site strategy puts it in competition with those players for power, labor, and equipment.
A failure to secure financing for either the Helios expansion or the McGregor build would slow Galaxy's revenue ramp. Regulatory setbacks, such as a Texas-level moratorium on data center construction similar to New York's recent one-year ban, could also stall the project. Delays in ERCOT transmission upgrades beyond 2028 would push out the revenue timeline and pressure the stock further.
A successful bond placement for the Helios expansion and a signed power purchase agreement for McGregor by mid-2026 would signal credible execution. Galaxy's shares would likely reprice higher if the company demonstrates it can finance and deliver both campuses on schedule.
Galaxy's shift from crypto mining to AI hosting is a bet on sustained demand for compute capacity. The McGregor announcement extends that bet into a second Texas location. The stock's 8% drop reflected execution risk and capital uncertainty. The bond sale will be the next concrete test.
For broader context on crypto-related equities, see the Galaxy Digital junk bond story.
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