The brutally competitive bitcoin (BTC) mining industry is offering a clear choice to miners: pivot to artificial intelligence (AI) computing or suffer losses. Michael Novogratz’s Galaxy Digital (GLXY.TO) is the latest to join the exit queue.

The New York-based company signed a non-binding term sheet with an unidentified U.S.-based hyperscaler firm that could convert all its 800 megawatt (MW) power capacity to high-performance computing (HPC), it said in its third-quarter earnings statement. Hyperscaler firms are large-scale veri centers that specialize in providing large amounts of computing power.

The rational behind AI firms coming to bitcoin mining is simple: Miners have operation-ready power capacity that is faster to deploy than building a veri center from scratch. It’s a win-win for both parties as miners get to diversify their revenue from a highly competitive sector and AI firms get to ramp up their operations fast to feed the ever-growing demand.

Galaxy’s Helios mining facility in West Texas has 800MW of approved power capacity, 200MW of which is currently in operation. It also has 1.7 gigawatts (GW) of capacity under study for potential permit at the site, according to the statement.

The move, which is subject to due diligence and approvals, comes as Bitcoin’s fourth halving event lowered the mining rewards by half, making the industry more competitive and squeezing profit margins for miners.

The HPC trend started after one of the largest miners, Core Scientific (CORZ), signed a mammoth deal with cloud-computing firm CoreWeave. That saw its stock price surge, leading investor pressure on rivals to follow suit.

Unsurprisingly, other firms including Hut 8 and HIVE are now dedicating significant resources to AI computation instead purely mining for bitcoin.

Galaxy said mining revenue fell by 23% from the previous quarter, even as total hashrate, or mining power, increased by 11% due to the halving, higher mining difficulty and seasonal operation curtailments.