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Across the cryptocurrency industry, a quiet reinvention is underway. Companies that spent years building warehouses full of specialized computers to mine bitcoin are discovering that the same power connections, cooling systems, and buildings are exactly what artificial intelligence developers are eager to rent. One of the smaller players making that turn is DMG Blockchain Solutions Inc. (OTCQB: DMGGF, TSXV: DMGI).
DMG describes itself as a vertically integrated data center and digital asset technology business, which is a formal way of saying it owns and runs the whole chain of operations rather than renting pieces from others. Its main site sits at Christina Lake in British Columbia, Canada, where it has historically mined bitcoin using low cost, sustainable power. The company splits its work into two pillars it calls Core, meaning physical infrastructure, and Core+, meaning software and services. In recent months, the story has shifted toward a third idea: turning that power capacity into rented space for AI computing.
The clearest sign of that shift is a letter of intent, first announced in June, to lease 50 megawatts of capacity at Christina Lake to a single, unnamed tenant for AI data center colocation. Chief Executive Sheldon Bennett said the company is working toward a binding agreement while it selects contractors and engineering partners, applies for permits, lines up financing, and addresses concerns raised by the local community. The proposed deal would run for an initial 12 years, with the first phase of capacity targeted for delivery by the end of 2026, though the company stresses that nothing is guaranteed until a definitive contract is signed.
The financial picture explains some of the urgency. Revenue for the quarter came in at about $4.6 million (CAD $6.4 million), down 13% from the prior quarter and down 45% from the same period a year earlier. The company received 61.9 bitcoin from mining, roughly a quarter fewer than a year ago, and its computing power, measured as hashrate, fell 14% to 1.47 exahashes per second as older, less efficient machines were retired.
Lower activity flowed through to the bottom line. DMG recorded a net loss of about $2.8 million (CAD $3.9 million), or two cents per share, compared with a much smaller loss a year earlier, when a gain on bitcoin holdings had softened the result. Operating and maintenance expenses fell, helped by cheaper energy rates and the removal of inefficient miners. The company closed the period with roughly $30.0 million (CAD $41.6 million) in cash, short term investments, and digital assets, and total assets of about $73.7 million (CAD $102.3 million), both lower than three months earlier, as the value of its bitcoin holdings dropped.
To understand why a company would step back from its original business, it helps to look at the wider industry. Mining margins have thinned since bitcoin’s 2024 reward halving, while demand for AI computing has sent technology firms hunting for any site with enough electricity to run rooms of power hungry chips. The research firm CoinShares has estimated that AI and high-performance computing could climb from roughly 30% of listed miner revenue in late 2025 to as much as 70% by the end of 2026 for firms that sign real contracts, with larger operators such as Core Scientific and TeraWulf already booking billions of dollars in such deals.
For DMG, the coming months will test whether a relatively small operator can convert a promising letter of intent into steady, dollar-based income before its mining business shrinks further. The 50-megawatt plan offers a route to more predictable revenue, yet it still hinges on financing, permits, and a tenant that has not been named publicly.
