Galaxy Digital Holdings Ltd., the firm run by Mike Novogratz, won an auction to buy self-custody platform GK8 from Celsius Network as it was put up for sale during a Chapter 11 bankruptcy process.
(Bloomberg) — Galaxy Digital Holdings Ltd., the firm run by Mike Novogratz, won an auction to buy self-custody platform GK8 from Celsius Network as it was put up for sale during a Chapter 11 bankruptcy process.
Galaxy will be adding a team of nearly 40 people including cryptographers and blockchain engineers, and expects GK8 to help expand its prime brokerage, according to a statement. Terms weren’t disclosed. Galaxy bought the assets for materially less than the $115 million Celsius paid for them last year, Galaxy Co-President Chris Ferraro said.
“This is a point of time in the market where trust is at its lowest, and we think that going forward now, there’s going to be a much higher bar, much higher scrutiny on all the players market participants depend on,” Ferraro said in an interview. “It puts Galaxy in a very sticky way into the infrastructure of digital assets.”
Novogratz, Galaxy’s founder and chief executive officer, said the firm is looking to pick up distressed assets during a cryptocurrency crisis that has led to the Chapter 11 filings of multiple firms. The addition of new talent comes after Galaxy itself has let go of 15% of its own headcount. In a Bloomberg Television interview on Thursday, Novogratz said that, in three months, acquisitions could end up expanding the firm’s headcount.
The deal is subject to court approvals, Galaxy said in the statement. The acquisition will expand the firm’s reach to institutional investors by offering clients greater control of their digital assets, and would also give Galaxy a more global reach with a new office in Tel Aviv, the firm said.
“The idea of having self-custody as an option is very top of mind,” Ferraro said. “We’ve had our sights on bringing forward the tech side of Galaxy for a long time now.”
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