Why Google, Microsoft, And Meta Are Building In West Texas? According To Galaxy Digital Executive

• Hyperscalers are flocking to West Texas for the abundant power, transmission infrastructure, and available labor, said Simrit Dhinsa of Galaxy Digital.
• Dhinsa said it’s often easier to build big AI campuses in West Texas than to build out power infrastructure in big metro areas, which are running up against grid constraints.
• The company is also continuing its Texas footprint expansion, recently acquiring a 500-acre site in McGregor and securing up to 1.6 GW of approved capacity at Helios.

Hyperscalers like Google (GOOG), Microsoft (MSFT), and Meta (META) are moving into West Texas due to abundant power availability and proximity to major transmission infrastructure, according to Galaxy Digital's (GLXY) Vice President of Data Center Capital Markets, Simrit Dhinsa.

Dhinsa made the comments on the “Galaxy Brains” podcast on Friday, saying West Texas has easier access to fiber, labor and water than the limitations of building out power infrastructure in metro areas, making it an increasingly appealing base for large-scale AI data centers. 

On The Bitcoin Mining-To-AI Shift

"Traditional data centers are typically in the tens of megawatts, so you have many of them, often in and around big metropolitan areas to serve those regions. Some of the other big hyperscalers have built at hyperscale, but Bitcoin miners were among the first to really pioneer building these absolutely giant data center projects. Some of the big Bitcoin miners have been massive — Helios, for instance, was massive for Bitcoin mining,” said Dhinsa.

Galaxy has similarly made the trade, shifting its Helios site in West Texas from Bitcoin (BTC) mining to an AI data center. Galaxy delivered the first 200 megawatts to CoreWeave (CRWV) under a 15-year lease, part of a deal to supply 800 megawatts that Dhinsa called a “very, very exciting milestone” for the company.

Galaxy's West Texas Bet

Dhinsa went on to note the shift wasn't just a matter of scale. "What needed to happen to transition from a Bitcoin mining data center to an AI training and inference data center? What's different? I remember when I visited Helios, it was really cool for many reasons — one, because it was all liquid-cooled ASICs. Does that exist for this? There are these liquid-cooled GPUs. What else had to change?," said Dhinsa.

Dhinsa said Galaxy has since secured ERCOT approval for 1.6 gigawatts total at Helios, locking in capacity ahead of new regulatory batching rules meant to weed out speculative land-banking as Texas’s interconnection queue swelled to roughly 430 gigawatts.

Stadium Naming-Rights

Earlier this month, Galaxy put its own regional money where its mouth is, signing a 15-year, $70 million-plus naming rights deal to rebrand Texas Tech's football stadium, home of the Red Raiders, as "Galaxy Stadium." Host Alex Thorn joked that he might make it back to Lubbock for a game there himself.

GLXY stock closed down by 2% on Friday. On Stocktwits, the retail sentiment around GLXY remains in the ‘bullish’ zone, while chatter around it stayed at ‘high’ levels over the past day.

The expansion continued even as GLXY stock fell over 10% on Tuesday, to a three-month low, the same day Galaxy announced a second Texas AI campus, a 500-acre site in McGregor.

Read also: ARK Invest Buys $6.7 Million Of CRCL Stock, Adds CoreWeave And Solana ETF, Sells Shopify

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