Mike Novogratz’s Galaxy Digital is seeking to raise $250 million to help fund and revive struggling crypto companies that were damaged by the bear market last year. The crypto merchant bank is planning to roll out a credit fund to issue loans to the blockchain companies.
To obtain a loan, crypto companies will have to provide cryptocurrency, property or crypto mining machines as collateral according to a report. The credit fund will be a part of its asset management unit.
According to a Bloomberg report on Wednesday, Galaxy Digital Holdings has also invested in Symbiont.io, a blockchain company that seeks to apply blockchain technology to the capital market. Symbiont also got investments from other companies including Nasdaq Inc. and Citigroup Inc.
Numerous companies including many players from Wall Street are increasingly investing in blockchain based companies. Blockchain big guns like Binance and Ethereum have launched their own programs for funding crypto firms. Crypto lending indeed is a huge business. We’ve seen many traditional loan companies step into the lending space as well both for average consumers as well as other crypto firms.
Galaxy Digital is one among public crypto companies. Novogratz bought a Canadian crypto startup called Coin Capital and then merged the company through a reverse takeover with a Canadian company called Bradmer Pharmaceuticals. The combined company came to be known as Galaxy Digital Holdings Ltd. Galaxy Digital then became listed on Canada’s TSX Venture Exchange.
Galaxy Digital reported a loss of $76.65 million in Q3 2018. Novogratz said that it “sucks to build a business in a bear market.” He also increased his stakes in Galaxy Digital by buying 7.5 million ordinary shares of the company for 7.42 million Canadian dollars in January. Now he holds close to 79.3% stake in the company.
Whether it is a bear market or not, it seems like Galaxy Digital is providing good value to the crypto community.