In a push to keep up with institutional demand, Galaxy Digital has acquired DrawBridge Lending and Blue Fire Capital. Galaxy Digital believes the acquisitions will put them in a position to expand market reach and nourish their trading solutions portfolio.
Galaxy Digital Acquisitions
According to a press release, Galaxy Digital has acquired DrawBridge Lending and Blue Fire Capital. With the acquisitions, Galaxy Digital will expand its digital asset trading business, and position itself as a go-to source for rising institutional demand.
DrawBridge operates as a CFTC regulated Commodity Trading Advisor. They provide institutional investors with hedged financial products through structured loans. Institutional investors looking to leverage digital asset can take advantage of various opportunities such as:
- Commercial & High Net Worth Individual Loans
- Hybrid Investment Loans
- Crypto Retirement Account ( IRA ) Loans
Blue Fire Capital is a self-funded proprietary firm that focuses on futures markets and digital assets. Through strategic relationships with crypto exchanges globally, Blue Fire provides two-sided liquidity in crypto assets. They focus on Bitcoin, Ethereum, Litecoin, Bitcoin Cash, Ripple ( XRP ), and many others.
With Galaxy Digital processing over $4 billion a year in OTC volume, they strive to bridge the gap between cryptocurrency and institutional investing. The company strongly believes the acquisitions will help them expand their diversified financial offerings while affiliating with years of lending and derivatives expertise.
Christopher Ferraro, the President of Galaxy Digital stated that:
“Galaxy Digital’s mission is to bring cryptocurrency to traditional finance and vice versa. DrawBridge and Blue Fire’s market-leading capabilities will enable us to further amplify our strong position as a go-to trading desk in digital assets and more rapidly grow our innovative portfolio of trading products and services. Furthermore, these acquisitions bring in two exceptional and experienced teams who will play key roles in managing and expanding our business in the years to come.”
Michael Novogratz, the Founder, and CEO of Galaxy Digital also commented that:
“Institutional investors and corporates are becoming more knowledgeable and comfortable with digital assets and they are increasingly grasping the purpose and importance of cryptocurrency in their investment strategies. We are looking forward to seamlessly integrating DrawBridge and Blue Fire into Galaxy Digital Trading and strategically leveraging our world-class team, technology and solutions to help further meet what we believe will be an even bigger wave of institutional demand.”
How The Acquisitions Could Fuel Growth
By acquiring two entities that focus on disparent services, Galaxy Digital projects strong synergy in the foreseeable future. It will look to monetize on some of the following areas:
- Increase annual OTC trading volumes by diversifying into derivatives & futures trading, on-exchange market-making, and structured products (lending/borrowing).
- Leverage GD relations to monetize DrawBridge’s lending and structured products. This also includes the integration of DrawBridge’s $150MM in off third-party assets.
- Fuse GD and Blue Fire’s relations with global crypto exchanges. By leveraging Blue Fire, GD will also have the ability to offer institutions top tier market access. Blue Fire already oversees $36B in annual notional derivatives trading volume.
- With Blue Fire being Chicago-based, GD looks forward to building out its presence in Chicago and expanding prime brokerage, agency, and electronic trading offerings.
As institutional interest continues to mount in digital assets, Galaxy Digital is building out distinctive solutions that can help these entities navigate this emerging market. The interest from large investors is no longer a myth. Aside from hedge fund giants like Paul Tudor Jones entering the space this year, overall interest has continued to increase as well. In a report by Huobi Exchange this year, leadership stated that institutional investors are flocking to digital assets due to price volatility and high liquidity.
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