Galaxy Digital CEO Remains Optimistic in Face of $175M Q2 Losses

Divya  |  Aug 18, 2021

US-based financial services company Galaxy Digital has posted losses exceeding $175 million in its Q2 earnings report. Despite this, its CEO Mike Novogratz is unbothered by the dwindling performance. 

Citing several important metrics such as counterparty trading volume growth and the addition of blue-chip partnerships with Bloomberg and Goldman Sachs, Novogratz asserted that the company delivered another quarter of “rapid growth consistent with the pace of adoption of the crypto economy.” 

Galaxy Digital CEO Mike Novogratz Unbothered by $175M Q2 Losses

According to a press release issued on Monday, Novogratz attributed the sizable Q2 loss to market fluctuations. He stated:

“During the quarter, our results were impacted by a 34% decline in overall digital asset prices and a 41% decline in the price of Bitcoin, relative to the end of the first quarter.” 

He conceded that crypto volatility battered Galaxy’s core digital asset holdings, however, much of its impact was reduced by the company’s high counterparty trading activity, strong growth across its operations, and gains in derivates.

Novogratz highlighted that Galaxy’s trading division had witnessed consistent growth in volumes, which rose up to 90% from the last quarter and 560% from the last year. Additionally, the company’s assets under management (AUM) increased over 12% in the second quarter to surpass $1.6 billion, despite the ups and downs in crypto prices

“It’s important to remember that when we look at the business, the long-term arc of adoption of digital assets in crypto matters far more than the businesses we are building,” Novogratz said during the earnings call. “We view the adoption battle as hard one, stickier, and more financially impactful over time in short-term price moves.”

The quarterly report also showed that Galaxy’s gross counterparty loan originations grew more than 130% since the previous quarter to roughly $1.56 billion. 

Galaxy Digital’s Expansion Effort With Key Leadership Hires

In an effort to expand its operation in Europe, Middle East, and Africa (EMEA), Galaxy appointed some new members to leadership roles. Novogratz revealed that the company had named Tim Grant, former CEO of Swiss digital asset exchange SDX, as the head of Europe. Grant will be joined by former BlackRock COO Jennifer Lee who will serve as the company’s chief people officer. 

Altogether, Galaxy expanded its workforce by 45% in Q2, leading to a total headcount of 220 staff members working in different countries.

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