Author: CryptoSlate

Translated by: ShenChao TechFlow

ShenChao Editorial: Galaxy Digital has financed $3.5 billion for CoreWeave to build an AI data center in Texas, with annual interest as high as $346 million. The repayment of this debt entirely depends on whether it can be delivered on time by 2027—once the construction schedule is delayed, Galaxy will be trapped in a dilemma of only paying interest and being unable to repay the principal.

Galaxy Digital has financed $3.5 billion for CoreWeave to build data centers in Texas, costing about $346 million in interest each year.

On July 23, Galaxy's project subsidiary priced and issued priority secured notes at an annual interest rate of 9.875%. The transaction is expected to be completed on July 28, and the notes will mature on August 1, 2031.

This financing will be used to cover part of the construction of eight data halls in two buildings at the Helios campus. The facility is planned to provide 400 MW of utility capacity and 260 MW of critical IT capacity, with part of the funds also allocated for debt reserve.

Principal repayment starts after construction completion

A 9.875% coupon rate means an annual interest of $346 million, payable in cash on February 1 and August 1 each year starting in 2027. The first payment only covers part of the year, but Galaxy has not disclosed the exact amount.

Principal repayment is executed on a different schedule. The notes are amortized annually at 4% of the original principal, adjustable. Before adjustment, it is $140.28 million per year, paid semi-annually, with the first payment date at least 10 months after project completion.

Interest starts on a fixed schedule, while principal repayment can only begin after construction completion and is adjustable. Creditors will have first priority claims on nearly all project assets and the parent company's equity in the issuer.

The disclosed liens cover Galaxy Helios Data Centers II LLC, its project guarantors, and the parent company's stake in the issuer. They do not extend to the general assets of Galaxy Digital.

In April 2025, CoreWeave committed to adding approximately 260 MW of critical IT load for the second phase. Galaxy stated that the terms are fundamentally similar to the previously announced 15-year, 133 MW first phase agreement.

Delivery now becomes the core operational test. On July 6, Galaxy stated that the first phase was completed on time, and the delivery of the second phase data hall is expected to begin in the first half of 2027.

The construction timeline now has a clear financial cost. Interest begins in 2027, but principal repayment must wait until project completion, which makes Galaxy's delivery schedule central to its CoreWeave deal and debt obligations before 2031.