Crypto Financial Services Firm Galaxy Digital Seeks to Boost Balance Sheet
Crypto financial services firm Galaxy Digital is looking to increase its balance sheet by acquiring assets from distressed crypto companies. This new focus comes after the firm was mandated to manage FTX’s crypto holdings for creditor repayments, which significantly increased its assets under management from $1.7 billion to $5.4 billion.
FTX Assets Could Boost Profits of Galaxy Digital
The recent FTX crypto mandate could provide a substantial boost to Galaxy Digital, according to Andrew Bond of Rosenblatt Securities. He believes that it opens up opportunities for the firm to win other mandates that could be more profitable.
Galaxy Digital reported a $94 million loss in the third quarter and has struggled to recover from the market crash of 2022. However, it has successfully invested in other crypto firms such as Fireblocks and Polygon Labs.
Crypto Estates Begin to Repay Creditors
Last year’s crypto collapses have led to various bankruptcy proceedings. Celsius, BlockFi, and Mt. Gox are among the companies that are starting to repay their creditors.
Binance’s US business initially planned to acquire the assets of bankrupt crypto broker Voyager Digital but decided against it due to regulatory concerns.
Hot Take: Galaxy Digital Expands Its Balance Sheet with Distressed Crypto Assets
Gaining control of FTX’s crypto holdings has allowed Galaxy Digital to significantly increase its assets under management. By acquiring assets from distressed crypto companies, the firm aims to further boost its balance sheet and potentially secure more profitable mandates in the future. Despite recent losses and market volatility, Galaxy Digital has made successful investments in other crypto firms, demonstrating its ability to navigate challenging market conditions. This move positions Galaxy Digital as a key player in the crypto financial services sector and highlights its commitment to supporting the recovery and growth of distressed companies in the crypto space.
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