Galaxy Digital Set to Rebound Following Crypto Reset | Crypto

Galaxy Digital Set to Rebound Following Crypto Reset

Read Time:2 Minute

– Galaxy Digital Holdings Ltd. is a financial services leader in digital assets and blockchain technologies.
– The company captured the massive growth in the space over the last several years across a diversified operation that includes Trading, Asset Management, and Investment Banking.
– While 2021 was a record year for the company, the environment more recently has been defined by the sharp correction in crypto and broader macro headwinds.
– Galaxy Digital shares are off more than 70% over the past year, highlighting the extreme volatility.
– The key to recognizing is that the opportunities in Web3 like payments, Defi, and the metaverse are still in the early stages of adoption.
– Galaxy Digital can benefit from themes that go beyond any single cryptocurrency.
– A planned U.S. listing on Nasdaq compared to its current primary trading on the Toronto Stock Exchange could be positive for the stock going forward.
– Core advisory and management fees reached $6.2 million, up from $2.4 million in the period last year.
– Galaxy Digital has also been moving forward with its proprietary Bitcoin and digital asset mining operation which delivered a $10.9 million net income in Q2 compared to just $2.2 million in Q2 2021.
– The company is focusing on its performance over the past 18 months, which confirms the transformation of the operation over the period.
– Asset Management AUM at $1.7 billion, is up 110% based on momentum from several fund products and investment vehicles.
– Partner’s Capital, effectively the company’s net equity under the current structure, at $1.8 billion has increased by 130% compared to the end of 2020.
– The company ended the quarter with over $1.5 billion in liquidity, including over $1.0 billion in cash compared to $425 million in long-term notes payable.
– A key development came in August when Galaxy Digital announced it was terminating its planned acquisition of BitGo, an institutional digital assets service provider.
– The original $1.2 billion deal disclosed back in March between cash and stock was expected to generate synergies by adding ancillary business lines and complementing Galaxy’s current offerings.
– Fast-forward, BitGo allegedly failed to deliver an audited 2021 annual report by July 31st, which was cited by Galaxy as a breach of the agreement.
– There is some controversy because reports suggest BitGo is attempting to sue Galaxy for $100 million as an “improper repudiation” of the merger.
– The termination ends up being positive for Galaxy considering the timing of the original terms from March in Q1 was reached under an elevated crypto market pricing environment.
– It remains to be seen how the lawsuit from BitGo moves forward, although the upside is that Galaxy Digital could now head into 2023 with a stronger balance sheet and presumably some room to seek out new deals at attractive prices.
– The key

image 1340496871 Galaxy Digital Set to Rebound Following Crypto Reset

Leave a Reply

%d bloggers like this: