Former Wall Street hedge fund manager and prominent cryptocurrency investor Michael Novogratz is raising $250 million through his crypto-focused merchant bank Galaxy Digital LP. The company’s looking to create a lending fund for cryptocurrency companies.
Mike Novogratz Raising $250M: Expanding Operations
Galaxy Digital LP is raising $250 million in order to create a lending fund targeting cryptocurrency and blockchain-oriented companies.
The intention is to designate a lending fund which will issue loans to firms dealing in the field of cryptocurrencies and blockchain. The loans can be collateralized with the firms’ existing cryptocurrency assets, properties, and even mining hardware.
The move aims to expand the merchant’s bank current operations by essentially providing additional liquidity for the companies’ existing assets.
According to the report, Galaxy Digital has been able to prove to investors that there is a substantial demand for crypto-to-USD lending and it opens up a market for different lenders such as blockchain startups and miners whore looking for additional liquidity without necessarily having to sell property and assets.
Galaxy Digital is a cryptocurrency merchant bank which was listed on Canada’s TSX Venture Exchange following a reverse merger in 2018.
The move by Mike Novogratz comes at a particularly appropriate timing for launching services of the kind.
The current market conditions are definitely unfavorable for crypto-oriented businesses, given the prolonged bear market of 2018.
Since the beginning of last year, the market lost around $700 billion of its total capitalizations, with major cryptocurrencies such as Bitcoin marking losses of more than 75 percent.
The tumbling market conditions have caused major industry players such as decentralized exchange ShapeShift to lay off a serious number of people.
What are your thoughts on Galaxy Digital’s future crypto lending fund? Share your thoughts in the comments below!