Matthew Sigel
Head of Digital Assets Research at VanEck, Portfolio Manager of NODE ETF
Galaxy Digital's public shares deserve a discount because its Up-C structure leaves insiders in control while public common holds less than half the enterprise's economics. Insiders take tax savings through the Tax Receivable Agreement, and an early buyout of it at $30 could cost the company about $1 billion, as could a Helios spin-off. Combined with crypto volatility, time to power and its revealed cost of debt, a discount is warranted, though its size is debatable. x.com x.comÂ
Galaxy Digital's Up-C structure treats public shareholders as second-class owners. Public holders own Class A stock in a topco, while Novogratz and insiders hold the real asset in the operating partnership. A tax receivable agreement sends 85% of cash tax benefits to legacy partners rather than the public company, and Class B voting shares plus a director nomination deal lock in insider board control. It is legal, and the view would change if those facts do. x.comÂ
Galaxy Digital is in no man's land as a stock for now. Its core trading business probably breaks even, worth maybe $5 a share, its CoreWeave HPC deal still has a long ramp before cash flows arrive, and its approved Texas capacity has only 50/50 odds of getting power assigned, so hyperscalers won't commit. That tempers @SimonSaysBTC's math on Helios, including about $1.2B of annual revenue from the 800 MW CoreWeave contract. x.comÂ
Galaxy Digital faces structural selling pressure because it needs equity financing, and Mike Novogratz knows it. A single raise to institutions obliterated the stock, while IREN absorbs regular ATM sales easily. The market dislikes the crypto part of the business and, more importantly, has no confidence that a team of crypto executives can pull off a data center build-out. That follows a new filing flagged in a post the author replies to. x.com x.com x.comÂ
Galaxy Digital may be the market's most undervalued stock because its $6.5B value overlooks Helios I's contracted rent and $6.6B in cash, Treasuries, digital assets and investments. Its first full Helios I Phase I quarter delivered $69M of data-center adjusted EBITDA. Novogratz said Galaxy rejected a Helios II lease as power tightened; a higher-priced tenant is still prospective. Galaxy expects $800-850M in annualized leasing by end-2027, and the stock should quickly reach $30+ by year-end. … Show more
CleanSpark is bad for shareholders because it loses money mining Bitcoin, at an all-in cost above $120K per coin. Even excluding about $670M of markdowns on its Bitcoin holdings, it lost almost $400M over the past year, and depreciation eats the rest of its so-called profits. Its shareholder equity is below what it has raised from investors, though its miners are still carried above their worth. This rebuts @Market_Maestros, who argues miners trade on EV/EBITDA and the losses are unrealized. … Show more
WM Technology still appears to have multibagger optionality, all things considered, though risks remain. A tax receivable agreement becomes more relevant as taxable income grows, 29.1M shares remain available for future issuance, and going dark could let it be treated as a piggy bank. x.comÂ
Reduced perceived CoreWeave credit risk and a fully ramped lease would support a higher valuation for Galaxy Digital. A $50 share price in 18 months seems reasonable if the CoreWeave lease reaches $1B+ of EBITDA and the first phase of an 830MW lease to a new investment-grade tenant is online by mid-2028, adding $200M-$300M of EBITDA. Further leases and execution at other sites, a crypto bull market and recurring digital-asset licensing revenue could take it much higher. x.comÂ
Heavily indebted data-center and compute names, including CoreWeave, IREN, Cipher, TeraWulf, Core Scientific, Riot, MARA, Hut 8, Bitdeer and Bit Digital, are vulnerable if credit tightens next year. High-debt firms get punished in tightening, especially if a credit freeze stalls projects, and panicked markets sell everything. TeraWulf shows the risk, with a $427.6 million Q1 net loss, $713 million of quarterly cash burn and $7.09 billion of liabilities. This is a macro basket trade. x.com x.com … Show more
Bit Digital's discount to NAV is not attractive because its exposure to volatile assets like bitcoin cuts both ways. It works while bitcoin is running, and the company also carries heavy dilution. x.comÂ
Scarce power available for 2028 delivery and rising demand for that capacity favor Galaxy Digital, IREN and Cipher Mining. XCapitalMgmt highlights Galaxy management's report of delayed competing projects, stronger demand from hyperscalers and AI firms for 2028 capacity, and more selective financing. Galaxy has over 800 MW secured at Helios II but is still evaluating tenants and deal terms. x.comÂ
Galaxy Digital's $7.6B market cap assigns essentially no value to its Helios data-center business. x.comÂ
