Crypto firm DMG Blockchain Solutions Inc. is procuring 10MW worth of modular prefabricated data centers as part of a partial pivot to AI.

The company this week announced it has signed a memorandum of understanding (MoU) with an undisclosed counterparty to purchase the infrastructure for 10MW worth of prefabricated air-cooled data centers for its deployment of generative AI facilities.

DMG and the unnamed counterparty have agreed to work towards a definitive agreement within the next 90 days.

Upon execution of the definitive agreement, DMG would pay the counterparty $5 million as an upfront payment and the balance of the to-be-agreed-upon price based on future DMG revenue from AI computing agreements as part of vendor financing being offered to DMG.

Revenue from off-take agreements may be derived from either GPUs that DMG purchases or the colocation of customer-purchased GPUs. DMG is currently focused on securing off-take agreements.

DMG intends to deploy the data centers at one or more locations. Further details weren’t shared.

Details on the prefabbed facilities weren’t shared. The company noted the infrastructure does not include medium-voltage power distribution, battery storage, or backup power generation, and would not include computing, networking, or storage systems. The data centers would meet Sensitive Compartmented Information Facility (SCIF) specifications – often associated with high-level government and military requirements.

DMG’s CEO Sheldon Bennett, said: “This MoU catalyzes our entry into generative AI in a very meaningful way. Not only does the PDC [prefabricated data center] shorten our time to deployment by at least a year, but it also gives us the needed credibility as a new AI entrant to secure off-take agreements in a timely manner.”

He continued: “Given the SCIF nature of the infrastructure, we will be focused on off-take opportunities that prioritize this need, as we believe we can garner a revenue premium for offering this capability. This MoU also enables us to proceed with our generative AI strategy in a most capital-efficient manner, helping us to maximize our return to shareholders.”

Amid increased demand for capacity and limited supply, crypto-focused companies with ample amounts of cheap power are pivoting to serve AI cloud firms. The likes of Hive Digital Technologies, Northern Data, Applied Digital, Iris Energy, Mawson Infrastructure, Crusoe, and others are but a small number of those that have made the shift.

DMG (formerly Digital Mint Group) was founded in 2016 and describes itself as a vertically integrated blockchain and data center technology company. The company currently operates a 60MW data center in Canada’s British Columbia that was launched in 2019. The 33-acre Christina Lake site houses a 27,000 sq ft (2,508 sqm) building in Grand Forks.

The company has recently signed a MoU with the Malahat Nation to build and operate 30MW of AI data center capacity. The Malahat First Nation is a Coast Salish First Nations community of Saanich People with two reserve lands located on the western shore of Saanich Inlet, Vancouver Island in British Columbia.

The MoU, with the Malahat First Nation’s Economic Development Corporation, would see 15MW developed by DMG at the Christina Lake facility, and another 15MW developed on Malahat land on Vancouver Island. Malahat will hold a controlling stake in the joint venture.

DMG also aims to procure battery and energy system management technologies from Malahat Battery Technologies — a limited partnership between the economic development corporation of the Malahat Nation and Energy Plug Technologies Corp. – to deploy battery systems at the two sites.