According to a Nov. 13 announcement, Galaxy Digital plans to leverage the two newly acquired firms to strengthen its “trading solutions portfolio, relationships with global exchanges, and lending and derivatives expertise.”
“Galaxy Digital’s mission is to bring cryptocurrency to traditional finance and vice versa,” said Christopher Ferraro, the firm’s president. “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.”
The merchant bank operates Galaxy Digital Trading, an always-active global trading service for institutional customers and more than 200 counterparties that trade more than $4 billion of OTC volume annually. Peter Wisniewski, the co-head of the trading division, explained that the acquisition of the firms allows Galaxy Digital to further expand its services:
“These acquisitions are a continuation of this progress to date, and an important milestone as we continue to broaden our talent base and build out our differentiated capabilities, spanning fiat and digital asset lending, structured products, and prime brokerage services.”
In the announcement, the firm explains that 2020 saw a “broad institutional recognition of cryptocurrency use cases by investors, corporates, regulators, and governments” which resulted in a sharp increase in institutional demand for crypto services. Michael Novogratz, a former Goldman Sachs executive and Galaxy Digital’s founder and CEO further explained:
“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 [the newly acquired firms] to help further meet what we believe will be an even bigger wave of institutional demand.”
Galaxy Digital is also actively trying to get more investors on board with crypto. In July it started schooling financial advisors on digital assets in partnership with alternative investment platform CAIS.
Galaxy Digital is growing its presence and influence in the industry at a fast pace. As Modern Consensus reported at the end of September, the firm also recently invested in decentralized finance (DeFi) asset management firm ParaFi Capital. At the time Novogratz said that he believes DeFi has ”transformative” potential.