Galaxy Digital (GLXY) Research: A Hybrid of Web3 Institutional Services Provider and AI Data Center

Unless otherwise specified, all data is as of November 19.

1. Research Summary

Galaxy Digital (GLXY) is a hybrid platform spanning crypto finance and AI compute, with operations across three core segments: (1) Global Markets (trading, market-making, and crypto investment banking); (2) Asset Management & Infrastructure Solutions (fund management, staking, custody, and principal investments); and (3) AI data centers and compute infrastructure (the Helios campus).

Over the past three years, Galaxy has climbed from the trough of the crypto winter to synchronized multi-segment growth. In Q3 2025, driven by the boom of Digital Asset Treasury Companies and the sale of 80,000 BTC, the firm posted over USD 730 million in adjusted gross profit—a record high. The asset management and staking segment reached USD 9 billion in AUM and USD 6.6 billion in staked assets, generating over USD 40 million in annual management fees. Meanwhile, the Helios mining facility has fully transitioned into an AI compute campus, secured by a 15-year contract with CoreWeave. The three-phase agreement locks in all 800MW of power capacity, with projected annual revenue exceeding USD 1 billion once fully delivered.

GLXY’s financial results have been highly volatile and significantly driven by crypto-market conditions: the firm posted nearly USD 1 billion in losses in 2022, returned to profitability in 2023, and reached USD 365 million in net income in 2024. Although earnings softened in the first half of 2025, Q3 delivered a record quarterly profit of USD 505 million despite overall market turbulence, with adjusted EBITDA turning meaningfully positive—indicating stronger resilience in its core businesses.

For valuation, we apply a SOTP (Sum-of-the-Parts) framework: we estimate USD 7.7 billion for Galaxy’s digital-asset financial services and USD 8.1 billion for its AI compute infrastructure business, totaling USD 15.8 billion. Adding net assets yields an implied equity value of roughly USD 19.4 billion. With Galaxy’s current market cap at USD 10.1 billion, the stock trades at a 48% discount to our SOTP valuation. Potential reasons include investors’ conservative stance toward companies exposed simultaneously to cyclical volatility (with crypto arguably at a cycle peak) and transformation risk (compute revenue ramps meaningfully only starting in 2026).

PS: This article reflects the author’s views as of publication. These views are preliminary and subject to change, and may contain errors in facts, data, or reasoning. Nothing herein constitutes investment advice. Comments and critiques from peers and readers are welcome.

2. Business Segments and Product Lines

Galaxy Digital was founded in 2018 by former Wall Street star investor Michael Novogratz, previously a partner and macro fund manager at Fortress Investment Group. Today, Galaxy operates across three primary divisions: (1) Global Markets (including trading, derivatives market-making, investment banking, and lending); (2) Asset Management & Infrastructure Solutions (including fund management, staking services, and principal investments); and (3) Data Centers and Compute (spanning former Bitcoin mining operations and ongoing AI/HPC high-performance computing infrastructure). The following section provides a detailed breakdown of each major product line, its business model, recent developments, and revenue contribution.

2.1 Global Markets

Business Scope and Definition

The Global Markets division encompasses Galaxy Digital’s institutional digital-asset trading and related financial services and represents its core revenue driver. This segment consists of two major components: Franchise Trading and Investment Banking. The Franchise Trading team serves as a market maker and liquidity provider in the crypto markets, delivering OTC spot and derivatives execution to more than 1,500 counterparties across 100+ digital assets. Galaxy also leverages its regulated entities to offer collateralized digital-asset lending, OTC prime brokerage, and structured yield products—providing miners, funds, and other institutions with leverage, hedging tools, and immediate liquidity. The Investment Banking team provides financial advisory services to blockchain and crypto-native companies, including M&A advisory, equity and debt financing arrangements, and private placements, helping digital-asset businesses connect with traditional capital markets. Collectively, these offerings enable Galaxy to deliver Wall Street-grade, full-spectrum financial solutions tailored to the evolving needs of institutional participants in the crypto ecosystem.

Key Development Milestones

• 2018–2019: Galaxy Digital was founded in 2018 with the mission to “bring crypto to Wall Street and bring Wall Street into crypto.” In its early years, the firm rapidly built a comprehensive platform spanning trading, asset management, and principal investments, quickly establishing an institutional client base.
• 2020: Galaxy achieved a step-change in its trading capabilities through acquisitions. In November 2020, it acquired DrawBridge Lending and Blue Fire Capital, strengthening its capabilities in OTC lending, derivatives, and bilateral market-making. These deals expanded Galaxy’s product suite into leveraged loans, OTC options, and structured notes, pushing annual OTC trading volume above USD 4 billion and increasing active counterparties to nearly 200.
• 2021: The firm hired seasoned executives, including former Goldman Sachs partner Damien Vanderwilt to build a crypto-focused investment banking division offering M&A and capital-markets advisory. Galaxy also acquired Vision Hill Group, a digital-asset investment advisor and index provider, enhancing its fund product and analytics capabilities. On the trading side, the team developed GalaxyOne—a unified institutional platform integrating trading, lending, and custody—and completed its core technical architecture during the year.
• 2022: Despite the crypto winter, Galaxy’s Global Markets division continued expanding. The Franchise Trading team grew its counterparty base to over 930 by Q4 and maintained liquidity provision across 100+ assets. The investment banking team advised on several notable transactions, including Genesis Volatility’s acquisition by Amberdata and CoreWeave’s strategic investment from Magnetar Capital. Notably, Galaxy’s own acquisition of the Helios mining facility also received internal advisory support, demonstrating strong cross-department synergies.
• 2023: As markets recovered, the Global Markets division rebounded strongly. Galaxy expanded its presence in Asia and the Middle East, establishing teams in Hong Kong and Singapore to support family offices and funds. Investment banking executed multiple M&A and financing mandates, including acting as buy-side advisor for the acquisition of GK8 and advising on several mining-sector restructurings. Despite continued volatility in the crypto sector, Galaxy’s revenue proved more stable than that of typical exchanges due to its diversified income mix (interest revenue, market-making spreads, advisory fees, etc.).
• 2024: With digital-asset markets recovering, Global Markets delivered record results. Full-year counterparty trading and advisory revenue reached USD 215 million—exceeding the prior two years combined. Q4 revenue hit USD 68.1 million (up 26% QoQ). Growth was driven by derivatives trading and strong institutional lending demand: Q4 derivatives and credit counterparty volume rose 56% QoQ, and average loan book size reached a record USD 861 million. Counterparties increased to 1,328 by year-end. Investment banking completed nine advisory mandates in 2024, including three in Q4, such as acting as exclusive advisor on Attestant’s sale to Bitwise and assisting Thunder Bridge Capital in its SPAC merger with Coincheck.
• 2025: Entering 2025, digital-asset markets rebounded sharply, driven by ETF optimism, lifting Galaxy’s Global Markets business to new highs. In Q3 2025, the segment delivered USD 295 million in adjusted gross profit—up 432% QoQ and the highest in company history. Total quarterly trading volume surged 140% QoQ, vastly outpacing the broader market. Highlights included Galaxy’s mandate to sell 80,000 BTC (≈USD 9 billion notional) for a major institution, significantly boosting spot volume. Galaxy also executed ETH share-purchase transactions for BMNR and SBET. Institutional lending expanded rapidly with Q3 average loan balances reaching USD 1.78 billion (up 60% QoQ). The investment banking team completed a USD 1.65 billion PIPE for Forward Industries (as joint placement agent and advisor) and acted as exclusive advisor on Coin Metrics’ sale to Talos. These landmark deals reinforced Galaxy’s leadership in digital-asset investment banking. Looking ahead, amid the accelerating “token-equity convergence” trend, the market expects Galaxy’s Global Markets revenue and profitability to materially exceed prior years.

Summary of Financial Results and Public Disclosures (2023–2025)

Revenue and Profitability： In 2023, as the market remained in the late stages of a bear cycle, Galaxy continued to post overall losses, although the Global Markets division showed improvement in the second half of the year. Entering 2024, Global Markets became the primary driver of company performance: full-year counterparty trading and advisory revenue reached USD 215 million, a substantial increase compared with roughly USD 100 million in 2022 when market conditions were depressed. Profit contributions from derivatives and quantitative trading increased meaningfully, while interest income also expanded alongside the growth in the lending book. In 2024, adjusted EBITDA for the Global Markets division exceeded USD 100 million, highlighting strong operating leverage. In Q4 2024 alone, Global Markets generated USD 68.1 million in revenue, directly driving the company back to profitability for the quarter. By Q3 2025, Galaxy reported that its digital assets businesses (Global Markets and Asset Management combined) generated USD 250 million in adjusted EBITDA for the quarter, with Global Markets contributing the majority. The Global Markets segment itself delivered USD 295 million in adjusted gross profit during the quarter. This underscores the exceptional earnings leverage of Galaxy’s trading operations under bull-market conditions. It is worth noting that despite strong operational momentum, Galaxy’s consolidated net income during the first three quarters of 2025 continued to be affected by volatility in principal investments (for example, a loss in Q1 tied to digital-asset price declines). However, growth in core operating businesses remained solid. Management indicated in the Q3 2025 earnings report that with the full rollout of the GalaxyOne platform and increased institutional onboarding, trading-related revenues are expected to rise further. At the same time, the cost-to-income ratio of the Global Markets division improved, reflecting enhanced operating efficiency and delivering meaningful operating-leverage benefits to the company.

2.2 Asset Management & Infrastructure Solutions

Business Scope and Definitions

The Asset Management & Infrastructure Solutions segment integrates Galaxy Digital’s digital asset investment management and blockchain infrastructure technology services, serving as an important complement to the Global Markets division.

In the Asset Management business, Galaxy provides diversified digital asset investment products to institutional and accredited investors through its subsidiary, Galaxy Asset Management (GAM). Its offerings include: (1) public market products such as ETFs/ETPs issued in partnership with traditional financial institutions—covering single-asset Bitcoin and Ethereum ETFs and blockchain-themed ETFs; and (2) private fund products, including actively managed hedge funds (alpha strategies), venture capital funds (investing in blockchain startups such as those under Galaxy Interactive), crypto index funds, and fund-of-funds structures, giving investors diversified risk-return exposure. Galaxy also offers customized digital asset investment services for institutional clients, such as digital asset index construction, treasury-management solutions, and co-investment (SPV) opportunities. As of Q3 2025, Galaxy’s assets under management (AUM) approached USD 9 billion, covering more than 15 ETFs and alternative investment strategy products, placing it among the largest digital asset managers globally.

In the Infrastructure Solutions business, Galaxy leverages its technological and operational expertise to provide institutions with foundational blockchain network services and custody solutions. The business centers around two major components: Custody and Staking. Galaxy’s 2023 acquisition of the GK8 platform enhances its institutional-grade self-custody capabilities, enabling clients to securely store digital assets through cold-wallet and MPC (multi-party computation) solutions. GK8 also supports advanced features such as DeFi protocol participation, tokenization issuance, and NFT custody, enabling Galaxy to deliver a “one-stop” digital asset infrastructure suite for institutional clients (e.g., token-issuance platforms). In its staking business, Galaxy has built a dedicated blockchain infrastructure team that provides validator hosting and staking-as-a-service. The team operates a globally distributed validator network supporting major PoS blockchains such as Ethereum and Solana, allowing clients to delegate their assets for network validation and earn staking rewards. Galaxy’s staking services offer institutional-grade security and flexibility: integration with regulated custodians such as Anchorage, BitGo, and Zodia enables convenient staking directly from custody, while Galaxy also provides innovative collateralized financing against staked assets, allowing clients to borrow against staked tokens to enhance capital efficiency. In addition, Galaxy engages in proprietary venture investing through divisions such as Galaxy Ventures, investing in high-quality blockchain startups and protocols. By the end of 2022, the company had invested in more than 100 related firms (145 total investments). These strategic positions generate potential financial returns while expanding Galaxy’s industry influence and partnership network (e.g., early investments in Block.one, BitGo, and Candy Digital). Overall, the Asset Management & Infrastructure Solutions segment enables Galaxy to extend vertically across the value chain, providing clients with a dual-engine service model that spans both asset management and underlying blockchain infrastructure.

Major Development Timeline

• 2019–2020: Galaxy began building its asset-management business and partnered with traditional financial institutions to launch crypto investment products. In 2019, Galaxy and Canada’s CI Financial jointly launched the CI Galaxy Bitcoin Fund, a closed-end Bitcoin fund listed on the Toronto Stock Exchange—one of the first publicly offered Bitcoin products in North America. In 2020, they followed with the CI Galaxy Bitcoin ETF, which became one of the lowest-fee Bitcoin ETFs globally at the time. Through these collaborations, Galaxy established itself as an early pioneer in the public crypto-product market.
• 2021: In May, Galaxy acquired Vision Hill Group, a New York–based digital-asset investment advisor and asset manager, bringing its team and product suite—including a crypto hedge-fund index, the VisionTrack data platform, and fund-of-funds products—under Galaxy. After the acquisition, the Galaxy Fund Management platform gained enhanced data-driven decision support and a more comprehensive product lineup. That same year, Galaxy Asset Management expanded its actively managed offerings, launching products such as the Galaxy Liquid Alpha Fund. By year-end, assets under management reached USD 2.7 billion—up sharply from USD 407 million at the beginning of the year.
• 2022: In Q4, Galaxy announced a strategic partnership with Itaú Asset Management, one of Brazil’s largest private banks, to jointly develop digital-asset ETFs for the Brazilian market. The first product, the “IT Now Bloomberg Galaxy Bitcoin ETF,” was launched in late 2022, giving Brazilian investors access to physically backed Bitcoin exposure through local exchanges. That year, Galaxy’s AUM fell to USD 1.7 billion (down 14% YoY) due to broader crypto-market conditions, but the company strategically emphasized scaling active strategies. For example, the Galaxy Interactive fund continued successful investments across gaming/metaverse startups, and the Liquid Alpha hedge fund achieved net inflows despite challenging market conditions.
• 2023: In February, Galaxy won the auction to acquire the GK8 digital-asset custody platform from the bankrupt Celsius Network for approximately USD 44 million—significantly below Celsius’s original USD 115 million purchase price. The GK8 team of nearly 40 people, including top cryptography and security experts, joined Galaxy, which also established a new R&D center in Tel Aviv. GK8’s patented technology—including offline cold-vault signing and MPC-based hot-wallet infrastructure—enables institutions to sign on-chain transactions without internet connectivity and automates multi-signature custody operations. This acquisition substantially strengthened Galaxy’s capabilities in custody, staking, and DeFi connectivity. CEO Novogratz described it as “a key step toward delivering a full-stack financial platform.” GK8 was later integrated into the GalaxyOne platform as a core tool enabling institutions to self-manage their assets. Galaxy’s asset-management business also saw notable developments in 2023: the firm was appointed advisor to the FTX bankruptcy estate, assisting in liquidating its asset portfolio—a mandate that brought additional fee income and a reputation boost. As markets recovered, Galaxy’s AUM rebounded, reaching roughly USD 3 billion by Q4. At year-end, Galaxy introduced its upgraded platform brand, “Galaxy Asset Management & Infrastructure Solutions,” integrating traditional asset management with blockchain-infrastructure services to highlight its differentiated positioning.
• 2024: Galaxy’s asset-management and blockchain-infrastructure operations entered a rapid-growth phase. In July, Galaxy announced the acquisition of most assets of CryptoManufaktur (CMF), a blockchain node operator founded by veteran Ethereum engineer Thorsten Behrens. CMF specializes in automated Ethereum node deployment and oracle-infrastructure operations. The acquisition immediately added roughly USD 1 billion of Ethereum staking assets to Galaxy’s platform, raising its total staked assets to USD 3.3 billion. The core three-person CMF team also joined Galaxy, accelerating its expertise in Ethereum staking and oracle data services. Staking became one of Galaxy’s biggest highlights in 2024: fueled by the Ethereum Shanghai upgrade and institutional adoption, Galaxy’s staked assets surged from USD 240 million at the beginning of the year to USD 4.235 billion by year-end—a nearly 17× increase (USD 1 billion from acquisitions, the rest organic). Responding to rising demand, Galaxy secured integrations with major custodians: in February, it became BitGo’s integrated staking provider, offering one-click staking and triparty-lending functionality; in August, it partnered with Zodia Custody, the Standard Chartered-backed institutional custodian, to provide compliant staking to European clients; and it expanded integrations with Fireblocks, Anchorage Digital, and others. These moves significantly broadened distribution for Galaxy’s staking services.
• 2025: With market and regulatory conditions stabilizing, Galaxy’s Asset Management & Infrastructure Solutions segment continued its strong progress. In Q3 2025, the segment generated USD 23.2 million in adjusted gross profit—up 44% QoQ—reflecting expanding scale. The growth was driven primarily by over USD 2 billion in net inflows during the quarter, sourced from multi-year mandates from large digital-asset-holding institutions—such as crypto foundations and public-company treasuries. These organizations contributed more than USD 4.5 billion in managed and staked assets as of Q3, generating over USD 40 million in recurring annual management-fee revenue. Galaxy refers to this offering as “Digital Asset Treasury Outsourcing,” helping foundations and enterprises manage and grow their crypto reserves. As a result, Galaxy’s AUM rose to nearly USD 9 billion, and staked assets reached USD 6.61 billion—both record highs. On October 29, Galaxy announced the completion of its staking-service integration with Coinbase Prime, becoming one of Coinbase’s select staking providers. This partnership allows Coinbase institutional clients to directly access Galaxy’s high-performance validator network, marking Galaxy’s entry into a top-tier custody ecosystem. Overall, in 2025, Galaxy achieved simultaneous product innovation, scale expansion, and ecosystem deepening across the asset-management and infrastructure businesses.

Summary of Financial Statements and Public Reports (2023–2025)

Asset Management Business Performance: In 2023, Galaxy’s asset management revenue declined amid weak market conditions, but began to recover in Q4 as market sentiment improved. In 2024, the company’s asset management division entered a period of strong growth, recording $49 million in revenue for the year — a record high, and a significant increase compared with roughly $28 million in 2022. The key drivers were organic net inflows and market appreciation, which expanded AUM and boosted fee-based revenue, and Mandates related to the FTX bankruptcy, where Galaxy assisted in selling assets on behalf of creditors and earned substantial commissions. By the end of 2024, Galaxy’s assets under management (AUM) reached $5.66 billion, up from approximately ~$4.6 billion at the end of 2023. Among these, ETF/ETP products accounted for $3.482 billion, and Alternative investment products (e.g., venture capital funds) accounted for $2.178 billion. Galaxy’s asset management operating profitability also improved in 2024, with adjusted EBITDA exceeding $20 million, indicating that scale effects are beginning to materialize.

In the first three quarters of 2025, Galaxy’s asset management division continued to expand under strong market conditions. The most recent third quarter was particularly notable:

• Galaxy’s assets under management (AUM) reached nearly $9 billion. Alternative investment products surged 102% QoQ to $4.86 billion, while ETF AUM also increased to $3.8 billion.
• Staking assets rose 110% QoQ to $6.6 billion.
• Driven by this growth, the Asset Management & Infrastructure Solutions segment generated $23.2 million in revenue (GAAP-adjusted gross profit), representing a 44% QoQ increase. The single-quarter revenue was almost half of Galaxy’s total for the entire year of 2024.

Overall, from 2023 to 2025, Galaxy’s digital asset businesses—including Global Markets and Asset Management—experienced a powerful rise from cycle lows to new highs, supported by the crypto bull market, favorable regulatory developments, and the launch of ETFs. Both revenue and profitability reached record highs.

2.3 Data Centers & Computing Power

Business Scope and Definition

Galaxy Digital’s data center and computing power business is the company’s second major strategic pillar beyond digital assets, focusing on the investment, construction, and operation of foundational compute infrastructure. At its core, the business transforms abundant energy and data-center resources into computing power used for blockchain mining and high-performance computing (HPC), creating value for both Galaxy and its clients. Galaxy initially entered this sector through Bitcoin mining, deploying specialized mining machines in its owned or hosted data centers to earn Bitcoin block rewards. The company also provides hosting services and financial support to other miners—such as equipment hosting and maintenance, power-procurement advisory, and mining-rig financing—forming a full mining ecosystem. As demand for computing power surged in the era of artificial intelligence and big data, Galaxy shifted its strategy starting in 2023, gradually expanding its data-center resources to support AI model training, cloud rendering, and other high-performance computing workloads. Specifically, Galaxy has partnered with AI infrastructure providers to convert its large-scale campuses into AI compute supply hubs, generating stable rental and service income by leasing power capacity and server racks—effectively offering “Infrastructure-as-a-Service (IaaS)” for computing power.

Galaxy’s most critical data center asset today is the Helios campus located in Dickens County, Texas. The Helios facility was originally developed by Argo Blockchain to leverage West Texas’s abundant low-cost renewable energy—primarily wind and solar—for Bitcoin mining. However, when natural gas prices surged in late 2022, electricity prices spiked sharply, and Argo, lacking fixed-price power purchase agreements, was fully exposed to extreme power-price volatility. Under severe liquidity pressure, Argo sold the Helios facility to Galaxy Digital in December 2022 for USD 65 million, accompanied by an additional USD 35 million loan.

For Galaxy, the acquisition included not only physical infrastructure but also a crucial 800 MW of approved interconnection capacity. In Texas, large-load interconnection queues have stretched to more than four years, making Helios’s existing grid approvals one of the most valuable intangible assets on Galaxy’s balance sheet. In terms of scale, 800 MW already places Helios among the world’s top-tier compute campuses—by comparison, Google’s new AI data center in Arizona is planned at around 1,200 MW, while Microsoft’s expansions in Iowa and other regions fall in the 300–600 MW range. If Helios ultimately reaches its long-term vision of 3.5 GW (with an additional 2,700 MW still in the approval pipeline), it would exceed the world’s largest current data-center clusters by more than twofold.

Operationally, Galaxy does not run AI cloud services itself. Instead, it has entered into a 15-year hosting agreement with CoreWeave, an NVIDIA-backed leading cloud provider with insatiable demand for compute infrastructure. A series of long-term lease agreements between the two effectively transforms Galaxy’s power assets into bond-like, recurring cash flows. CoreWeave has already exercised all of its available options, securing the full 800 MW of approved power capacity at Helios. Their partnership uses a triple-net lease structure: Galaxy provides the physical shell and power interconnection, while CoreWeave bears the electricity costs (including price volatility), maintenance, insurance, and taxes. Under this model, Galaxy functions more like a digital real-estate landlord than a service operator, resulting in highly stable cash flow. For Galaxy, revenue is almost equivalent to net profit, with the business expected to generate EBITDA margins of up to 90%.

Galaxy has divided Helios campus development into multiple phases: Phase I will deploy 133 MW in the first half of 2026; Phase II will add 260 MW in 2027; and Phase III will deliver another 133 MW in 2027. Altogether, these phases will provide 526 MW of “critical IT load” for server deployment, corresponding to 800 MW of total power capacity. To meet CoreWeave’s requirements, Helios is undergoing a rapid transformation from a “mining farm” into an HPC-grade data center, including major upgrades to cooling systems, redundant architecture, and structural reinforcement.

Key Milestones in Development

• 2018–2020: Powered by the digital asset bull market, Galaxy recognized the strategic value of upstream computing power and began entering the Bitcoin mining sector. Initially, the company adopted a partnership-hosting model, entrusting miners to professional operators while providing complementary financial services such as miner financing and OTC hedging. During this period, Galaxy quietly invested in several mining infrastructure projects and built a team proficient in power systems and mining hardware, laying the groundwork for future self-developed facilities.
• 2021: Galaxy officially launched its “Galaxy Mining” division, elevating mining to one of the company’s core strategies. Throughout the year, Galaxy expanded partnerships with major mining operators in North America and actively scouted locations in Texas and other regions for building its own data centers.
• 2022: This year marked a major milestone for Galaxy’s data center strategy. On December 28, 2022, Galaxy announced the acquisition of the Helios Bitcoin mining facility in Dickens County, Texas, from Argo Blockchain for USD 65 million, along with a USD 35 million loan to support Argo through its liquidity crisis. Helios had only recently begun operations with 180 MW of built power capacity and significant room for expansion. After the acquisition, Galaxy immediately assumed operational control and designated Helios as its core mining hub. The company planned to increase the energized capacity to 200 MW by the end of 2023, allocating part of it to third-party hosting and part to Galaxy’s proprietary mining. This acquisition significantly expanded Galaxy’s mining footprint and was seen as “Galaxy securing its own Bitcoin factory.”
• 2023: In 2023, Galaxy’s data center operations began shifting from a pure mining model to a dual track of mining plus compute-capacity leasing. In the first half, Helios expanded steadily, reaching approximately 3 EH/s of deployed hashrate by mid-year, split evenly between proprietary and hosted mining. The recovery in Bitcoin prices improved mining profitability as well. In Q2, Galaxy reported Hashrate Under Management (HUM) of roughly 3.5 EH/s, with its proprietary mining maintaining one of the industry’s lowest unit costs. In the second half, while continuing to grow Helios’ Bitcoin capacity, Galaxy initiated discussions with CoreWeave to explore allocating site power and space for GPU server deployment. In September 2023, the two parties reached a preliminary agreement for Galaxy to provide land and power infrastructure at Helios, with CoreWeave moving in AI hardware in phases—marking the beginning of Galaxy’s strategic pivot. By Q4, HUM had increased to 6.1 EH/s with 977 BTC mined for the year, but Galaxy signaled that proprietary mining would be scaled back once agreements with CoreWeave took effect to prioritize Helios’ transformation.
• 2024: In this year, Galaxy’s data center business fully shifted its focus to HPC. On March 28, 2024, Galaxy announced that it had signed the formal Phase I lease agreement with CoreWeave: Galaxy would provide 133 MW of “critical IT load” in Helios Phase I for CoreWeave to deploy AI/HPC infrastructure under a 15-year term. Under the agreement, CoreWeave will pay Galaxy lease fees in a data-center-colocation-style–style structure, totaling an estimated USD 4.5 billion over the 15-year period. Galaxy stated that it plans to deliver the full Phase I capacity to CoreWeave in the first half of 2026. Shortly after, in April 2024, CoreWeave exercised the first option in the contract (Phase II), adding another 260 MW of IT load at Helios, bringing its total committed capacity to 393 MW. Galaxy noted that Phase II would follow economic terms similar to those of Phase I (i.e., long-term lease structure), with delivery expected in 2027. Meanwhile, Galaxy began significantly scaling down its Bitcoin-mining activities. In the first half of 2024, the company sold part of its mining rigs and gradually wound down its self-mining expansion plans, reallocating freed-up power capacity and physical space at Helios to retrofit data halls for high-density GPU servers. On November 7, 2024, Galaxy announced that it had reached a term sheet with a major financial institution for the Helios project financing, which was formally closed in 2025 (see below). By the end of 2024, Galaxy’s mining business hash rate had dropped to 6.1 EH/s, with some rigs idled and listed for sale. Self-mining profits declined as a share of the company’s total earnings, while capital expenditures for the data center segment surged as the business entered an investment phase. Nevertheless, during 2024, Galaxy successfully completed its strategic transformation—from a pure Bitcoin mining operator into an AI data-center developer with long-term contracts secured from major clients.
• 2025: Galaxy’s data center business entered a full-scale construction and financing phase. On August 15, 2025, Galaxy announced the completion of $1.4 billion in project financing (debt financing) to accelerate the development of the Helios AI data center. The loan, led by a major institutional lender, was issued at an 80% loan-to-cost ratio, with a three-year term, and secured by the assets of Helios Phase I. Galaxy contributed an additional $350 million in equity, bringing the total Phase I project budget to $1.7 billion, ensuring full funding for substation upgrades, cooling-system enhancements, structural reinforcement, and other key infrastructure needed for Helios Phase I. In August 2025, Galaxy also disclosed that CoreWeave had exercised its final option (Phase III), securing an additional 133 MW of IT load capacity and bringing its total contracted capacity at Helios to the full 800 MW of approved power. With this, 100% of Helios’s currently approved grid capacity is now fully leased. Based on the contracts and full utilization of the 526 MW of critical IT load, Galaxy expects the Helios project to generate over $1 billion in revenue per year on average over the next 15 years, making it one of the company’s most important long-term cash flow drivers. To plan for further expansion, Galaxy also acquired additional land surrounding Helios in 2025, increasing the total campus size to over 1,500 acres, supporting up to 3.5 GW of potential future power capacity—more than double the current 800 MW. These incremental power requests are now under review by grid operator ERCOT, and, once approved, will be developed in phases. In October 2025, Galaxy secured a $460 million equity investment from a leading global asset manager to support Helios construction and other corporate uses. Market speculation suggests the investor may be BlackRock (not officially confirmed). The investment will be completed in stages and will grant the investor an equity stake, marking strong institutional endorsement of Galaxy’s computing-power strategy. By the end of 2025, Galaxy reported that Helios Phase I construction was progressing on schedule, with 133 MW to be delivered to CoreWeave in the first half of 2026. Phase II site preparation and foundational work were also underway, with delivery expected in 2027, while Phase III is planned for delivery in 2028.

Financial Statements and Public Disclosures Summary (2023–2025)

Mining Business Performance: In 2023, Galaxy’s mining segment was still in the investment phase following the acquisition of Helios. With Bitcoin prices remaining depressed, the segment posted a full-year loss. However, as prices rebounded in 2024 and operations became more efficient, the mining business returned to profitability and generated stable cash flows. In 2024, the mining division reported USD 94.9 million in revenue and produced 977 BTC through proprietary mining, achieving an average gross margin of about 50% after deducting power and operating costs. Galaxy, however, cautioned in its filings that mining revenue would decline materially in 2025 due to the strategic transition. In 2025, as mining rigs were sold or gradually powered down, Galaxy’s mining revenue fell sharply. In Q3 2025, the data center segment (which at this stage primarily reflected the mining business) generated only USD 2.7 million in adjusted gross profit. Galaxy guided that, as Helios undergoes conversion, the company would see minimal mining profitability for the remainder of 2025, with potential partial resumption of residual rigs in 2026, depending on market conditions.

AI/HPC Hosting Business Outlook: Since the Helios–CoreWeave agreements begin generating revenue only after 2026, there was no recurring income from AI/HPC operations in 2023–2025. Galaxy capitalized most construction-period expenses, so the near-term income statement impact remained limited. In its 2025 Q3 earnings report, the company stated: Galaxy does not expect the data center segment to contribute material adjusted gross profit or EBITDA until the first half of 2026. Nevertheless, Galaxy provided investors with clear forward revenue guidance: once Helios is delivered and fully operational, the data center segment is expected to become the company’s new cash engine. Based on signed contracts, Galaxy expects to begin recognizing substantial lease revenues in H1 2026, with a REIT-like margin profile given that the tenant bears most operating responsibilities. In the August 2025 update, Galaxy disclosed that once all contracted phases are executed, Helios is expected to generate over USD 1 billion in average annual revenue and more than USD 15 billion over the 15-year lease term—several times the size of Galaxy’s current asset base. Even after accounting for operating expenses and interest on project financing, the net profit contribution is expected to be highly significant. Capital markets reacted strongly: Galaxy’s share price rose approximately 60% following announcements of full leasing and financing completion, signaling a meaningful re-rating of the company’s “compute infrastructure” franchise. In summary, the 2023–2025 period represents the “sowing stage” of Galaxy’s data center business financially, but management has repeatedly emphasized its long-term “harvest potential,” making it a central pillar of the Galaxy investment narrative.

Conclusion

In summary, Galaxy Digital’s three core business pillars—Global Markets, Asset Management & Infrastructure Solutions, and Data Center Compute—each occupy distinct segments of the digital asset value chain while simultaneously reinforcing one another under the company’s strategic framework. The Global Markets division delivers revenue through trading and investment banking activities, positioning the firm at the forefront of market developments; the Asset Management & Infrastructure Solutions division provides recurring management fees and technical advantages, strengthening long-term relationships with high-quality clients; and the Data Center Compute division is poised to generate substantial and stable cash flows, forming a “safety net” for Galaxy’s overall performance. Through clear strategic planning and a series of bold acquisitions and partnerships, Galaxy has transformed itself into a unique player spanning both finance and technology. In a rapidly evolving digital asset landscape, the growth potential and mutual support of these business pillars give Galaxy an uncommon degree of resilience and comprehensiveness in the eyes of investors. This also explains why an increasing number of institutional investors have shown interest and confidence in Galaxy. Looking ahead, the three business pillars are expected to continue advancing in parallel, consistently setting new milestones and creating shared value for both shareholders and clients.

3. Industry Analysis

Based on the above discussion, Galaxy’s businesses can be categorized into two industries: the cryptocurrency industry and the AI compute infrastructure industry. In the following sections, we provide a detailed analysis of the current landscape and development trends in both sectors.

3.1 Cryptocurrency Industry

Current Industry Landscape: Market Size, Participants, and Structure

Market Size and Key Participants: The cryptocurrency market regained strong momentum in 2024–2025, with North America accounting for roughly one-quarter of global trading activity. As of mid-2025, the region received approximately USD 2.3 trillion in crypto transaction value over the preceding year, with the monthly peak occurring in December 2024. Global crypto market capitalization approached USD 4 trillion by the end of 2024, while trading volumes reached all-time highs. In terms of market participants, centralized exchanges (CEXs) continue to dominate the majority of spot and derivatives trading. In 2024, the top 10 CEXs recorded USD 17.4 trillion in annual spot volume—double the previous year. Meanwhile, decentralized exchanges (DEXs) have rapidly expanded their share: during the first five months of 2025, DEX trading volume accounted for about 7.6% of the global total, up significantly from 3% in 2023. In addition, large market makers and OTC desks provide crucial off-exchange liquidity, forming what is often seen as the “third pillar of liquidity” beyond CEXs and DEXs. OTC trading is particularly important for transactions in the hundreds of millions, allowing block trades to be executed privately without impacting public markets. Leading market makers and brokers—such as Galaxy Digital, Jump Trading, Wintermute, and Cumberland—play a pivotal role by supplying liquidity to exchanges and facilitating large block trades. Traditional institutional investors (hedge funds, asset managers, etc.) are increasingly active as well, entering the digital asset market through high-tier exchange accounts or OTC channels. As a result, North America has a notably high share of “large-size” transactions (>$10 million), representing around 45% of all activity—much higher than in any other region.

Market Structure Shifts and Liquidity: There is an emerging trend of convergence between on-exchange and off-exchange market structures. On one hand, centralized exchanges have undergone consolidation: following events such as the FTX collapse, regulated North American platforms (e.g., Coinbase, Kraken) have strengthened their positions, while part of the trading activity has migrated to OTC desks and on-chain DEXs. Since 2024, OTC activity has surged: monthly OTC volumes in 2024 exceeded those of the previous year across the board, with Q4 off-exchange trading up 106% year-over-year, and another 112.6% YoY jump in the first half of 2025. Institutions increasingly prefer to execute large build-up or unwind trades through “dark-pool-like” OTC channels to minimize market impact. This has turned OTC into a hidden liquidity pool, playing an expanding role in smoothing market volatility. On the other hand, improvements in decentralized trading technology—such as on-chain order books and Layer-2 scaling—have enabled DEXs to break through in long-tail assets and perpetual futures markets. By 2025, decentralized perpetual platforms (such as Hyperliquid) will have significantly increased their share of overall activity. Although CEXs still account for roughly 70–80% of total trading volume, DEXs are becoming increasingly important venues for trading emerging tokens and stablecoins due to their transparency and trustless nature. Overall liquidity improved markedly in 2024–2025 after the trough in 2022. Leading assets like BTC and ETH have returned to multi-billion-dollar daily trading volumes. Stablecoins have played a crucial role in improving liquidity and transparency: USD stablecoins are widely used as settlement currency, and by late 2024, North America saw record-high on-chain stablecoin transfer counts. Because stablecoin flows are transparent and traceable on-chain, capital movement between on-exchange and off-exchange venues has become easier to monitor, enhancing market transparency. Institutions increasingly rely on on-chain analytics tools to track fund flows, making the overall informational environment far more transparent than in previous years. Taken together, the North American crypto trading market is evolving toward a more institutional, multi-layered structure: CEXs provide core liquidity and fiat on/off ramps, DEXs support long-tail assets and trustless execution, and OTC channels handle large block trades. Together, these components form a more mature and comprehensive market system.

Regulatory Developments: In recent years, the regulatory landscape in North America—particularly the United States—has undergone significant shifts that directly influence market structure and participant behavior. The divergence between the U.S. Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) over the classification of digital assets has long created regulatory uncertainty. The SEC, viewing most tokens as securities, intensified enforcement actions and in 2023 pursued cases against exchanges such as Coinbase and Binance, effectively using “regulation by enforcement” to crack down on unregistered issuances and trading activities. Meanwhile, the CFTC classified Bitcoin and Ethereum as commodities and authorized regulated venues such as the CME to offer futures and options. This SEC–CFTC jurisdictional overlap resulted in fragmented oversight: certain instruments could only be traded in CFTC-regulated futures markets (e.g., Bitcoin futures ETFs), while spot exchanges—under SEC pressure—were forced to delist specific tokens or restrict trading access for U.S. Users. A meaningful regulatory shift emerged near the end of 2024 following political changes in Washington. The new administration signaled a more open stance toward digital assets. Agencies such as the SEC and the OCC withdrew earlier guidance that restricted banks from participating in crypto-related business and instead moved toward clearer frameworks encouraging traditional financial institutions to enter the sector. In early 2025, U.S. regulators halted a series of high-profile enforcement actions, widely interpreted as an end to the “enforcement-first” regime. The President’s Working Group even proposed positioning the U.S. as a “global crypto capital,” marking a decisive policy pivot that boosted institutional confidence and market sentiment. Alongside greater regulatory clarity, compliance requirements have tightened. Exchanges must meet more stringent KYC/AML and asset-transparency standards, while licensed custodians are increasingly integrated into the market to provide regulated custody and settlement services. A major milestone in the U.S. regulatory landscape has been the breakthrough in spot-ETF approvals. The first U.S. Bitcoin spot ETFs were approved and launched in early 2024, catalyzing rapid growth in crypto investment products. By July 2025, global Bitcoin ETF AUM reached approximately USD 179.5 billion, with U.S.-listed products accounting for around USD 120 billion. The spot-ETF structure opened a compliant investment channel through traditional brokerage platforms, making the allocation of Bitcoin and other digital assets far more accessible for institutional portfolios. Collectively, these regulatory shifts have transformed the North American market environment from restrictive to increasingly supportive. Boosted by policy developments, both trading activity and asset prices saw pronounced increases toward the end of 2024. Overall, regulatory uncertainty is declining, and a more coherent compliance framework is taking shape—reducing barriers for major financial institutions and publicly listed companies to participate in digital-asset markets.

Development Trends: Institutionalization, Derivatives, and New Products

Institutionalization and Strengthening Compliance: The North American crypto market is undergoing a rapid institutionalization process. Market participants have expanded from early retail users and crypto-native funds to include hedge funds, asset managers, and even traditional banks. Throughout 2024–2025, multiple indicators point to rising institutional participation: the share of large on-chain transfers has increased, traditional investment banks have begun applying for trading licenses, and major asset managers—such as BlackRock—have launched crypto trusts and even spot ETFs. This shift has driven market demand beyond simple trading activities toward auxiliary services such as regulated custody, auditing, and risk management. The heightened focus on compliance is pushing the entire industry toward standardization. Exchanges are strengthening internal compliance units, adopting on-chain analytics and monitoring tools. OTC desks are proactively seeking regulatory registration or licensing—mirroring developments in markets such as Hong Kong and Singapore, which have introduced OTC licenses to attract institutional trading. In the U.S., the split-regulator model is prompting trading firms to restructure their businesses: some platforms are registering as Alternative Trading Systems (ATS) or broker-dealers under SEC oversight to facilitate security-token trading; others are focusing on commodity-type assets under CFTC supervision. Overall, the influx of institutional capital is driving the market toward greater transparency and more robust risk management, accelerating industry consolidation. Companies with strong compliance capabilities and financial strength—such as Coinbase and Fidelity Digital Assets—are emerging as industry leaders. Firms like Galaxy Digital, which combine deep Wall Street roots with diversified business lines, are becoming preferred partners for institutions thanks to their ability to offer integrated, compliant solutions. As a crypto investment bank, Galaxy leverages its founders’ Wall Street experience and public-company governance standards to build strong credibility among institutional clients, enabling significant traditional capital to enter the crypto market through its OTC and asset-management platforms. Looking ahead, institutional participation and trading volumes are expected to continue rising. The market will evolve toward greater maturity and stability, with volatility gradually moderating.

Expansion of the Derivatives Market: Derivatives have become one of the fastest-growing segments of the crypto industry. As early as 2023, global crypto-derivatives trading volumes were already several times larger than spot volumes, and growth accelerated even further after 2024. In North America, derivatives trading occurs primarily through regulated venues: CME’s Bitcoin and Ethereum futures and options volumes have repeatedly hit record highs, with average daily Bitcoin futures trading activity rising substantially by the end of 2024. At the same time, demand for OTC derivatives remains strong, as institutions frequently use forwards, swaps, and other structured products for hedging or yield enhancement. Dealers such as Galaxy provide a full suite of customized derivatives—including options and swaps—enabling miners, crypto funds, and other clients to hedge price volatility or amplify returns. Notably, innovative products such as perpetual futures are gaining traction in the decentralized ecosystem. By 2024, decentralized perpetuals platforms accounted for roughly 4–5% of all futures volume, with this share rising further in 2025. This trend signals a gradual shift of derivatives trading from centralized to decentralized environments. Looking ahead, as regulators authorize a broader range of crypto-derivative products—such as options based on spot ETFs and volatility indices—the overall derivatives market is poised for expansion. This will likely draw more professional trading firms into the space, adding deeper liquidity and greater price-discovery efficiency. Correspondingly, risk-management and clearing mechanisms will continue to evolve, potentially incorporating central clearing counterparties (CCPs) or blockchain-based smart-contract clearing models to strengthen market stability.

Custody Integration and New Product Innovation: As institutional participation accelerates, a clear trend toward “execution–custody–clearing” integration is emerging. Regulated custodians have become a necessary component for institutions engaging in digital asset trading: custody providers and trading venues are now linked seamlessly via APIs, enabling rapid asset transfers between cold-storage custody accounts and exchanges—ensuring both security and timely market execution. This integration has given rise to the crypto prime brokerage model, which offers bundled services including custody, margin financing, and both on-exchange and OTC execution. Coinbase and Fidelity, for example, have launched comprehensive institutional platforms. Galaxy Digital, through acquisitions of custody technology (such as the GK8 self-custody platform) and integration of its OTC and brokerage businesses, is building a similar full-stack service architecture to meet institutions’ “one-stop” requirements. At the same time, new trading products continue to emerge and reshape market structure. Among them, stablecoins remain one of the most impactful innovations in the trading ecosystem: USD-backed stablecoins have become the dominant base currency for many trading pairs, reducing fiat on/off-ramp friction and enabling 24/7 trading. In the second half of 2024, stablecoin usage surged, with monthly on-chain transfer volumes reaching record highs. Their widespread adoption is enhancing the global consistency of market liquidity, ensuring that USD liquidity is available around the clock for trading worldwide. In addition, physically backed ETFs (such as spot Bitcoin ETFs) in North America have created a major conduit for traditional capital to enter the market. Following the launch of the first spot Bitcoin ETFs in 2024, their combined assets under management skyrocketed into the hundreds of billions of dollars within a year. The combination of stablecoins and ETFs now allows investors to obtain crypto exposure through two fundamentally different channels—on-chain markets or traditional brokerage accounts. This is reshaping trading flows: some volume, especially from long-term allocators, may migrate from crypto-native exchanges toward ETF products listed on traditional exchanges, while stablecoins continue to dominate settlement for both on-chain and OTC markets. Overall, the continuous emergence of new crypto trading products is enriching investment strategies while prompting a reconfiguration of market structure. Industry participants must adapt quickly to the opportunities and challenges brought by ongoing innovation.

North American Market Characteristics and Galaxy Digital’s Role

Regulatory fragmentation and regional dynamics: A defining feature of the North American (particularly U.S.) crypto market is its complex regulatory landscape, where federal and state-level regimes coexist. This creates pronounced regulatory fragmentation: the SEC and CFTC continue to contest jurisdictional authority, federal-level legislation remains unresolved, and individual states (such as New York with its BitLicense regime and others with OTC exemptions) impose their own rules. As a result, market participants must navigate a labyrinth of compliance requirements. This environment has historically generated uncertainty for exchanges and investors. Some U.S. exchanges have reduced their token listings for compliance reasons, while institutions have slowed their deployment due to regulatory risks. On the other hand, North America’s highly developed financial infrastructure and strict rule of law underpin its leadership in regulated innovation. The U.S. pioneered futures-based crypto ETFs, while Canada was the first to approve spot Bitcoin ETFs—both signaling the region’s willingness to integrate new asset classes within traditional frameworks. Investors in the U.S. and Canada also show a strong preference for regulated investment channels, favoring platforms that operate under supervisory oversight. This dynamic elevates the importance of regulated custodians and compliant trading venues. For instance, Bakkt—launched by ICE, the parent company of the NYSE—initially attracted significant institutional interest as a regulated digital asset custodian and futures exchange despite subsequent strategic shifts. Coinbase, the largest regulated crypto exchange in the U.S., holds major market share across retail and institutional segments; since its public listing, it has positioned itself as a cooperative regulatory counterparty and is widely viewed as an industry “whitelist” player. By contrast, many global exchanges (such as Binance) have faced stringent restrictions or exited the North American market entirely. This has led to a more domestically concentrated market structure, dominated by a small number of compliant giants (such as Coinbase and Kraken) and specialized institutional service providers. North American investors also place high emphasis on transparency and auditability; platforms are expected to regularly disclose asset reserves and undergo independent audits—standards that exceed those in many overseas markets. Overall, the North American market is characterized by stringent compliance requirements and a high degree of institutional participation. Although regulatory fragmentation has historically created a patchwork environment, new federal-level legislation (such as the market structure bills advancing in Congress) is expected to gradually harmonize the system around 2025, laying a more stable foundation for long-term industry development.

Roles of Coinbase, Bakkt, and Other Platforms: Coinbase stands as the undisputed leader in the North American crypto market, playing a dual role as both the primary retail gateway and an institutional on-ramp. Its retail trading volume is substantial, while its institutional arm (Coinbase Prime) serves hedge funds, corporate treasuries, and other professional clients by providing custody, block trading, and execution services. Following its public listing, Coinbase has been well-capitalized and, starting in 2023, aggressively expanded into derivatives by obtaining regulatory approval to offer crypto futures to U.S. users. Alongside its dominance in spot trading, Coinbase has become one of the major liquidity providers in the U.S. Market. Bakkt, by contrast, initially launched with physically delivered Bitcoin futures—a product that drew significant attention but saw limited trading volume. Bakkt later pivoted toward building a digital asset custody and settlement network for institutions and enterprises, and expanded further into broker-dealer crypto services through acquisitions such as Apex Crypto. Although Bakkt has maintained a relatively low retail profile, its backing by a major traditional exchange group gives it strong credibility in compliant custody and payment infrastructure. Platforms like Bakkt—with deep traditional-finance roots—offer institutions a secure, regulated infrastructure that complements the services of newer crypto-native firms. In a sense, Coinbase represents the path of a crypto-native company successfully embracing regulation and scaling, whereas Bakkt represents traditional finance’s exploration into the digital asset realm. Both enhance North America’s attractiveness to mainstream institutional participants. Beyond these two, regulated U.S. platforms such as Kraken and Gemini also play important roles—Gemini is known for its conservative listing standards and strong compliance posture, and Kraken offers a broader suite of derivatives products. Together, these platforms form a diversified matrix of compliant trading venues in North America. Their presence ensures that U.S. institutions have trusted, regulated channels for crypto trading without relying on offshore markets, ultimately fostering a healthier and more transparent trading ecosystem in the region.

Galaxy Digital’s Positioning and Competitive Landscape: As outlined in the preceding business analysis, Galaxy Digital’s core positioning within the crypto trading ecosystem spans multiple pillars: market-making and OTC brokerage, institutional prime brokerage and advisory, investment banking, asset management, and infrastructure services. Through this diversified strategy, Galaxy has built meaningful operational synergies—its proprietary GalaxyOne trading platform, extensive institutional network, and diversified revenue streams collectively differentiate it from many peers. By comparison, other major players in the North American market tend to specialize: Coinbase focuses primarily on exchange trading and custody; Fidelity emphasizes custody and custody-linked execution; dedicated market makers such as Cumberland and Jump concentrate on liquidity provision; and traditional investment banks like Goldman Sachs and Citigroup provide selective brokerage or liquidity services. Within this landscape, Galaxy stands out as one of the few firms offering a full-stack model that integrates trading, asset management, and infrastructure under one roof. Its principal competition comes from comprehensive platforms such as Coinbase, as well as newer crypto financial firms—Fidelity Digital Assets, Anchorage, FalconX, and other emerging prime brokers. Galaxy’s key strength lies in its breadth and flexibility: it can function as a market maker delivering deep institutional liquidity—a top requirement for sophisticated clients—while simultaneously serving high-end mandates through its investment banking division. Notably, Galaxy strengthened its competitive position by successfully listing on Nasdaq in May 2025, enhancing its brand visibility, regulatory transparency, and access to capital.

Overall, within the North American institutional crypto landscape, Galaxy Digital occupies a leading position in the second tier of major players: smaller in scale than Coinbase but highly regarded in institutional services. It maintains a mix of competition and cooperation with traditional financial institutions and specialized market makers. Looking ahead, as the digital asset market continues to institutionalize, Galaxy is well-positioned to secure a durable role in the crypto-focused investment banking and brokerage sector, alongside other top-tier industry leaders.

3.2 AI Compute Infrastructure Industry

Industry Status: Surging Demand and Structural Bottlenecks

Explosive Growth in AI Compute Demand: In recent years, compute requirements for training and inference of artificial intelligence models have risen exponentially. Large-scale pre-trained models—such as GPT-4 and PaLM—now contain hundreds of billions of parameters, and their training processes require massive parallel computation. Between 2023 and 2025, major technology companies and emerging AI labs have raced to train increasingly large models for applications in natural language processing, image generation, and beyond, directly fueling an unprecedented surge in GPU cluster demand. Training state-of-the-art models often involves hundreds to thousands of high-end GPUs operating continuously for weeks or even months, far exceeding the computational intensity of previous-generation workloads. Even after deployment, supporting AI inference for millions of users requires substantial compute capacity. As a result, compute has become the critical “factor of production” in the AI era, and shortages are increasingly common. North America—home to leading AI developers such as Google, OpenAI, and Meta—has experienced especially acute demand for high-performance computing (HPC) infrastructure. Some forecasts indicate that by 2025, global AI training compute demand will be several times higher than it was in 2022, driving an urgent need for large-scale data center expansion. Overall, AI computing has become the primary bottleneck limiting AI progress. The industry is witnessing a “compute arms race,” with companies spending aggressively to secure GPUs and build large-scale compute clusters to preserve advantages in the next wave of AI innovation.

From a “Chip Shortage” to a “Power Shortage”: The core constraint facing the North American data-center industry is undergoing a fundamental transition. While the past two years were dominated by GPU supply shortages, the primary bottleneck for the coming five years will shift decisively toward power availability—specifically, grid interconnection and transmission capacity. According to projections by Goldman Sachs, driven by the dual forces of generative-AI model training and inference workloads, U.S. data-center electricity demand is expected to grow at a compound annual rate of 15% from 2023 to 2030, reaching approximately 45 GW by 2030. However, expansion of the power-grid infrastructure lags far behind this demand trajectory.

The shortage is not merely a matter of insufficient power generation; it is primarily rooted in bottlenecks across the transmission and distribution network. In major U.S. data-center clusters such as Northern Virginia, timelines for grid interconnections and substation construction have lengthened substantially. Wait times that once averaged 1–2 years have stretched to 2–4 years or more. Supply chains for critical electrical components—particularly transformers—have also become severely backlogged, leading to sharply extended delivery cycles. This inertia in physical infrastructure has driven a revaluation of assets that offer instantaneous power access.

Against this backdrop, the “power shells” held by Bitcoin-mining companies—i.e., pre-approved large-scale power capacity, existing land reserves, water-use permits, and built high-voltage substation infrastructure—have emerged as highly strategic and scarce assets. Traditional data-center operators and hyperscalers urgently need such sites to deploy GPU clusters rapidly and capture the narrow window of opportunity in AI development.

Indeed, CoreWeave’s willingness to enter into leasing agreements with Galaxy on terms that appear highly favorable to Galaxy is directly tied to the strategic value of the Helios site’s 800 MW grid-interconnection approval. As disclosed in the 25Q3 report, CoreWeave has a revenue backlog of USD 55.6 billion, highlighting its extreme hunger for compute infrastructure. For many market participants, the main concern around CoreWeave is not demand, but its ability to execute and deliver on its commitments.

Representative Companies and Their Strategies: The North American AI compute-infrastructure sector has witnessed the emergence of multiple categories of players—including hyperscalers, specialized compute providers, and traditional data-center operators—working collectively to meet soaring market demand.

First, the major cloud hyperscalers remain the dominant force. Amazon AWS, which operates the world’s largest network of data-center facilities, continues to invest heavily in GPUs and AI-focused silicon, including its in-house Inferentia and Trainium chips, to address enterprise AI workloads. AWS has been building and upgrading high–performance computing–capable availability zones across the U.S., offering products such as P4d instances powered by NVIDIA GPUs. Microsoft Azure, supported by its deep partnership with OpenAI, is rapidly expanding supercomputing clusters, including dedicated AI supercomputers in states such as Iowa. Reports suggest Microsoft has invested several billion dollars in these deployments. Google Cloud leverages its proprietary TPU clusters and is simultaneously scaling its U.S. data-center footprint while offering a full suite of AI platform services. With deep capital reserves, advanced hardware-software stacks, and vertically integrated infrastructure, these hyperscalers dominate the high-end segment of the compute market through their IaaS and PaaS offerings.

Second, a new generation of specialized AI-compute providers is rising quickly, with CoreWeave as the standout. Originally a crypto-mining operator, CoreWeave pivoted to AI cloud services and subsequently became a capital-markets favorite, raising over USD 1.1 billion in equity financing and more than USD 2.3 billion in debt during 2023–24. The company focuses on GPU compute-as-a-service and builds infrastructure optimized specifically for AI training workloads, while aggressively expanding its data-center footprint across North America. Its strategy centers on developing distributed, region-specific compute hubs to serve local AI enterprises with low latency, while rapidly scaling power capacity through partnerships with real-estate developers and power-infrastructure providers. Following its IPO, CoreWeave’s share price has surged sharply, and NVIDIA’s USD 6.3-billion investment agreement underscores the market’s strong confidence in its trajectory.

Third, traditional data-center and colocation operators are also entering the race. Neutral colocation providers such as Equinix—historically focused on network interconnection and enterprise hosting—are increasingly adapting facilities to support high-power GPU deployments, driven by the wave of AI-related demand. Many are partnering with cloud providers to offer “edge compute” capabilities. Switch, a major U.S. data-center operator known for its high-density designs, has continued expanding its Nevada and other campuses after going private, attracting HPC customers with its advanced cooling technologies.

Capital markets remain extremely bullish in this sector. AI compute is widely viewed as the next frontier of infrastructure investment, leading to unprecedented fundraising and valuations. CoreWeave has secured more than USD 2.5 billion within a short period, attracting major institutional investors such as Blackstone and Coatue. After going public, its valuation soared, peaking near USD 100 billion in June and still hovering close to USD 40 billion. TeraWulf successfully brought Google in as a strategic investor. Even traditional data-center REITs—such as Equinix—have seen their stock prices buoyed by expectations of AI-driven demand. In many ways, capital markets are treating AI infrastructure as analogous to early cloud-infrastructure cycles, assigning high-growth expectations to companies in this domain. Investors have flocked to listed and pre-IPO compute providers, driving valuations sharply higher and signaling strong confidence in the durability of AI-compute demand. To be sure, some more cautious voices have raised concerns about sustainability—particularly around debt-funded expansion models and ongoing GPU-supply constraints. Yet overall, AI compute infrastructure is regarded as one of the most strategically valuable asset classes in the current technology cycle, with sentiment remaining broadly optimistic.

Development Trends: IaaS Model, Mining-to-AI Transition, and Regional Competition

IaaS Leasing vs. Self-Build Divergence: In AI compute supply, the industry is increasingly split between two models. One is the Infrastructure-as-a-Service (IaaS) / leasing model, where specialized compute providers or major cloud vendors build large GPU clusters and offer capacity on demand. This model allows customers to avoid upfront capex and operational complexity, accessing elastic compute for peak workloads. CoreWeave and AWS are the leading examples: they capitalize on the GPU infrastructure and serve a wide base of clients. For AI startups and SMEs—who face high barriers to building their own clusters—leasing remains the dominant choice. However, as compute demand surges among top AI labs and large tech firms, a second model is gaining traction: self-built, dedicated data centers. Large-scale players increasingly invest directly in proprietary compute infrastructure to optimize for cost, control, and performance. OpenAI, while supported by Microsoft, is exploring its own compute facilities; Tesla has built the Dojo supercomputer for autonomous driving training; and some hyperscale AI firms are even purchasing land and power assets to construct end-to-end campuses. This model enables specialized hardware architectures and long-term supply certainty but requires strong capital and operational capabilities. Thus, the industry is currently showing a clear two-tier split: hyperscale compute users tend to vertically integrate and build their own infrastructure, while most small- and mid-sized AI projects continue to rely on third-party compute clouds. In the coming years, the sector may follow a trajectory similar to cloud computing, with hybrid models becoming the mainstream: leading tech companies will maintain core proprietary compute capacity while renting additional resources to handle elastic demand, whereas mid-sized enterprises will primarily lease compute, complemented by limited on-prem or edge deployments. For compute providers, this opens the door to highly customized enterprise services: dedicated hosting (leasing entire data center buildings to a single client), private interconnect solutions, and hybrid configurations that allow major customers to enjoy the security and control of self-built infrastructure while preserving cloud-like flexibility. IaaS vendors will also increasingly secure long-term contracts with anchor clients—similar to CoreWeave’s multi-year agreements with numerous AI labs—moving closer to traditional IT outsourcing models. In short, the coexistence of leasing and self-built infrastructure will remain the prevailing trend, driven entirely by user scale and workload characteristics. The value chain will continue to seek a balance between standardized cloud services and bespoke enterprise delivery.

Transition from Mining Infrastructure to HPC: A notable trend is the migration of substantial infrastructure and operational know-how from the crypto mining sector into the high-performance computing (HPC) domain—including AI compute. The crypto mining boom from 2017 to 2022 built a massive base of power contracts, substations, and data-center-like facilities across North America. These sites were originally designed to run ASIC miners or GPU rigs, but as crypto markets fluctuated and Ethereum shifted to Proof-of-Stake (PoS), portions of this capacity have become underutilized or less profitable. Mining companies are therefore increasingly seeking to repurpose their “power + real estate” assets for AI compute. A representative case is CoreWeave: its founding team previously operated large-scale Ethereum GPU mining farms and pivoted toward AI cloud services at the right moment. Leveraging their existing GPU clusters and power advantages, they rapidly grew into a leading compute provider. Similarly, U.S.-based miner TeraWulf converted its Lake Mariner site in New York into an AI data-center campus, brought in AI tenant Fluidstack, and attracted strategic capital from Google. Another example is Canada’s Hut 8, which originally ran Bitcoin mining operations but announced a merger with a U.S. data-center operator in 2023, partly motivated by expansion into cloud and AI services. Regions that once hosted mega-mining sites—such as Texas or U.S. oil-field territories—are now seeing an influx of HPC development. This is because mining infrastructure (power availability, large land parcels, and experienced operations teams) aligns closely with HPC requirements. The key differences lie in upgrading IT infrastructure (replacing ASICs with GPU servers), enhancing cooling and networking systems, and developing new operational skill sets. Nonetheless, the conversion remains far easier and faster than building an HPC site from scratch. This transformation has received implicit—and sometimes explicit—support from local governments. Converting mining sites into HPC facilities often generates higher-skilled employment and yields greater social utility from power consumption (AI R&D vs. Bitcoin hashing), making these transitions politically favorable and occasionally eligible for policy incentives. Over the next two to three years, many former crypto compute hubs across North America are poised to be reborn as AI compute centers, supplying significant incremental capacity to the AI industry. For mining companies, pivoting to HPC also offers the benefit of securing long-term revenue contracts and reducing exposure to crypto market volatility. Overall, the transition from mining to HPC represents a more efficient allocation of resources and a win-win outcome between the crypto and AI sectors as their relative cycles evolve. It also underscores the universality of compute as an abstract resource: whether applied to blockchain or AI, compute is ultimately the combination of electricity and hardware—value is maximized when deployed where demand is strongest.

Regional Competition for Strategic Resources: As the wave of AI data center construction accelerates, competition around energy and geographic advantages has intensified. Texas, benefiting from low-cost power and light-touch regulation, has attracted a flood of new projects in recent years. Examples include Galaxy’s Helios campus, major expansions by mining giant Riot, and a variety of independent power-plus-compute developments. The state government has actively courted these operators with tax incentives, while ERCOT—the state’s independent power grid—encourages participation in interruptible loads. This enables computing centers to consume extremely cheap electricity during off-peak hours and earn compensation by curtailing usage during peak periods. Some operators are even partnering directly with wind and solar farms to build integrated, renewable-powered AI compute campuses. On the East Coast, regions like Virginia emphasize mature data center ecosystems and ultra-low network latency, positioning themselves to serve government agencies and financial institutions with AI workloads. Competition there is increasingly centered on obtaining scarce power allocations—Northern Virginia, in particular, has recently restricted approvals for new data centers due to grid capacity constraints. Operators are fiercely competing for limited substation capacity and interconnection rights. Canada and the Nordics are aggressively vying for overseas AI compute deployments. Quebec, with abundant hydropower and some of the lowest electricity prices in North America, previously froze new allocations for crypto mining but is now greenlighting AI projects in hopes of attracting Western supercomputing deployments (especially from Europe, where energy costs are high). Nordic countries are marketing their natural cooling advantages and renewable energy portfolios, actively courting hyperscale data center projects, including AI training facilities. Facebook and Google have invested heavily in Sweden and Finland over the past decade; now these regions aim to capture the next AI infrastructure boom. For compute operators, regional selection has become strategically decisive—not only due to electricity costs, but also policy risks (e.g., carbon regulations, permitting timelines) and customer proximity (low latency increasingly matters for AI workloads). As a result, multiple regions are competing to brand themselves as the “Silicon Valley of Compute,” offering tailored legislative and financial incentives. Texas has passed laws guaranteeing tax exemptions for data centers; North Dakota has established dedicated funds to support supercomputing projects; even Las Vegas markets its surplus cooling capacity and robust power infrastructure. Looking ahead, this regional resource competition is likely to intensify, echoing past races among U.S. states to attract automotive or semiconductor plants—except the new prize is AI data centers. The eventual outcome may be a more distributed and diversified deployment of compute infrastructure, located closer to energy sources or customer clusters, producing a more regionally balanced AI compute landscape across North America.

4. Management, Governance, and Shareholder Structure

4.1 Key Executive Team

Galaxy Digital is led by a management team that blends deep Wall Street experience with domain expertise in the crypto industry.

Founder and CEO Michael Novogratz is the driving force behind the firm. Known for his outspoken and long-standing bullish stance on crypto, Novogratz remains highly visible in the media and is directly involved in major strategic decisions.

President and Chief Investment Officer Christopher Ferraro—formerly an Executive Director in Goldman Sachs’ Investment Banking Division—joined Galaxy in 2018 and previously served as CFO. He now oversees day-to-day operations and drives strategic execution across business lines.

Chief Operating Officer Erin Brown, also with a Wall Street background, manages operations and risk oversight. Chief Financial Officer Tony Paquette comes from traditional financial institutions and is responsible for financial management and regulatory reporting.

Galaxy has also expanded its leadership presence in Europe, appointing former U.K. finance executive Leon Marshall as CEO of Europe to scale regional growth. The company has assembled a number of seasoned crypto specialists as well, including Jason Urban, Head of Derivatives, who previously led digital asset initiatives at major trading firms such as DRW.

The diversity and complementarity of Galaxy’s senior leadership—combining regulatory literacy, institutional-grade risk management, and crypto-native expertise—create a distinct competitive advantage. This blend enables decision-making that balances ambition with disciplined execution. During the Q3 earnings call, the team reiterated the firm’s focus on controlled growth, cost discipline, and risk management, noting that new offerings such as GalaxyOne are gaining traction with high-net-worth and institutional clients. Management also emphasized improved capital efficiency as a key driver of long-term profitability.

Historically, the leadership team has demonstrated strong strategic judgment. Notably, throughout the previous crypto bear market (early 2022 to mid-2023), Galaxy maintained stable operations—while much larger and louder industry players such as FTX, Luna, and Celsius collapsed. Leveraging its capital strength and timing, Galaxy successfully acquired GK8 and the Helios mining facility at distressed valuations. GK8 has since become a critical component underpinning Galaxy’s strong performance in the current bull cycle, while Helios—later repositioned entirely into AI/HPC infrastructure under the management team’s foresight—has evolved into a potential second growth engine. The site could generate up to $1 billion in annual revenue once fully deployed as a compute infrastructure asset.

4.2 Corporate Governance Framework

Since its inception, Galaxy Digital has placed strong emphasis on governance transparency and regulatory compliance—key factors underpinning its credibility with institutional investors.

The company maintains a Board of Directors with a majority of independent directors and has established specialized committees, including Audit and Compensation. These bodies operate under a comprehensive set of governance documents and internal control procedures. From a legal-entity perspective, Galaxy initially adopted an offshore structure—a Cayman Islands–registered limited partnership—through which it was listed on the Toronto Stock Exchange (TSX). To meet U.S. regulatory requirements and broaden its institutional investor base, the company underwent a corporate reorganization in 2025. Galaxy Digital Holdings Ltd. was redomiciled and restructured into Galaxy Digital Inc., a Delaware–incorporated C-corporation, effectively completing a “U.S. domestication.” The reorganization became effective on May 13, 2025, and Galaxy Digital Inc. began trading on Nasdaq under the ticker GLXY on May 16, 2025. Following the restructuring, Galaxy is now dual-listed in the United States and Canada, subject to oversight from both the SEC and Canadian securities regulators. Its reporting, disclosure, and accounting standards are fully aligned with those of publicly listed firms on Wall Street. This dual-jurisdiction structure enhances corporate governance credibility while significantly expanding the company’s eligible investor universe.

As part of the reorganization, all previous limited partnership units were converted into Class A common shares and Class B units of the new entity. Class A shares are freely traded in the public market, while Class B units are held by Michael Novogratz and other original stakeholders. Collectively, these Class B units represent approximately 53% of the company’s voting power. This structure ensures that management and early shareholders retain stable majority voting control over major corporate decisions—reflecting their long-term confidence in Galaxy’s strategic direction and enterprise value.

4.3 Listing and Changes in Shareholding Structure

As noted above, Galaxy’s corporate restructuring and listing have made it the only crypto-financial company in North America currently listed in both the United States and Canada. The company’s debut on Nasdaq marked a major milestone in its development, significantly enhancing its global visibility and broadening its access to capital markets. In the first month after listing, driven by positive market sentiment, GLXY shares rose cumulatively by approximately 55.87%.

Galaxy has also been actively bringing in strategic capital. In October 2025, one of the world’s largest asset managers invested USD 460 million in Galaxy, subscribing to 12.7778 million newly issued Class A shares at approximately USD 36 per share. The transaction involved both new share issuance and a small portion of secondary sales by senior executives, including Novogratz. Upon completion, the asset manager held about 7.5% of Galaxy’s equity and appointed an observer to the board, underscoring its confidence in the company’s long-term prospects. Meanwhile, between November and December 2025, early-stage locked-up shares began to expire, leading to the release of tens of millions of restricted shares into the market (detailed in the next section).

Overall, Galaxy’s current shareholder base is led by the founding team and strategic investors, with institutional ownership gradually increasing. This structure enables the company to maintain strategic stability while benefiting from external expertise and resources. Looking ahead, if the share price remains strong, Galaxy may consider a secondary offering or additional equity issuance in the U.S. market to raise capital—similar to its issuance of 29 million new shares in Q2 following the Nasdaq listing to fund the Helios investment. Management has emphasized, however, that any financing decisions will be made cautiously, with careful consideration of shareholder interests and a commitment to avoiding unnecessary dilution.

4.4 Lock-up Expiration

As of mid-November 2025, the share structure of GLXY is as follows:

A large portion of the company’s shares—roughly half—are still subject to lock-up restrictions. Under the IPO underwriting agreement, most locked shares are subject to a 180-day lock-up period and are scheduled to be released between November 12 and November 25, 2025. Given the size and concentration of this unlocking window, the event warrants close attention.

This lock-up expiration primarily involves pre-listing shareholders, including the company’s founder, senior management team, and early investors:

• Founder and Controlling Shareholder: CEO Michael Novogratz—through his personal holdings and affiliated entity Galaxy Group Investments (GGI)—controls the majority of the company’s shares. Disclosures indicate that Novogratz held approximately 194.59 million shares prior to the listing. These shares will, in principle, become freely tradable once the lock-up expires and represent the core portion of this unlocking event.
• Co-founders / Executives: Christopher Ferraro, President and CIO, along with other early team members, also hold meaningful stakes. Ferraro previously held several million shares, representing roughly 1–2% of the company. Additional executives—such as the COO, CFO, and board members—received shares in the restructuring prior to Nasdaq listing, and their holdings are likewise subject to this lock-up release.
• Early Institutional Investors: Some institutional holders acquired shares during earlier private placements or through the company’s prior Canadian listing (including institutions such as Fidelity and Vanguard with holdings of around 7–13%). Because Galaxy migrated its corporate domicile from Canada ahead of the U.S. listing, whether these institutions are subject to the U.S. IPO lock-up depends on the specific agreements. Certain institutions may not have been bound by the U.S. lock-up (having had the ability to trade on the Toronto Stock Exchange), although some might have agreed to limited restrictions during the U.S. listing transition. It is also worth noting that in October 2025, Galaxy brought in a top global asset manager as a strategic investor. This investor acquired 9.0278 million newly issued shares and 3.75 million shares transferred from executives, totaling 12.7778 million shares at $36 per share. Although these shares are not technically part of the May IPO lock-up, they cannot trade until the company files and clears a resale registration statement with the SEC. The company has committed to submitting this filing promptly. These shares are therefore effectively locked until registration becomes effective—expected around year-end.

In summary, the November–December unlock involves a broad set of key shareholders: the founder and affiliated entities, senior executives including Ferraro, and certain early or strategic institutional investors. Among them, Novogratz and GGI account for the largest portion, with executive holdings also meaningful. Strategic and institutional investors’ lock-up arrangements must also be taken into account when assessing potential selling pressure.

Intentions of Key Shareholders to Sell Shares

Founder / CEO Michael Novogratz: As the company’s controlling shareholder, Novogratz has historically demonstrated a long-term commitment to Galaxy. Since the listing, he has sold only a very small portion of his holdings, and only through a strategic block transaction rather than on the open market. In October 2025, he took the opportunity presented by a major strategic investment to sell 3 million shares at a negotiated discount—2.477 million transferred through GGI and 523,000 sold personally—representing less than 2% of his total holdings and generating proceeds of approximately $108 million. His choice to sell only modestly during a strategic capital raise, rather than sell into the secondary market, indicates a preference for strengthening the shareholder base rather than reducing exposure. He still holds approximately 192 million shares, or around 50% of the company. Given both his role as founder and the importance of maintaining control, Novogratz appears unlikely to engage in large-scale selling after the lock-up expires. Heavy selling would weaken his control position and could harm investor confidence. He has expressed no intention to further reduce his stake; instead, he has repeatedly emphasized his conviction in the company’s long-term value, stating during the listing ceremony that “this is only the beginning. Therefore, the most likely scenario is that Novogratz maintains his controlling stake and, at most, conducts selective small block sales (e.g., to long-term strategic investors), rather than any sizable open-market sell-down.

Senior Executives and Directors: In contrast to the founder, other executives show stronger incentives to monetize their holdings. Several have already begun selling shares ahead of the major lock-up expiration. According to regulatory filings, Christopher Ferraro, President and CIO, sold 750,000 shares shortly before the lock-up window, at an average price of $36, cashing out approximately $27 million. This represented more than half his total holdings, leaving him with fewer than 700,000 shares. Additionally, COO Erin Brown exercised options and sold 350,000 shares in August 2025 (after partial early unlock), and board member Rhonda Medina sold 33,300 shares in September. These transactions indicate that certain executives and directors have stronger motivations to realize liquidity, given their more diversified personal financial needs compared with the founder. Since several executives have already monetized shares during early unlock windows, it is reasonable to expect the possibility of further selling after the main November unlock window, especially if market conditions remain favorable. While Ferraro and other executives have not made explicit statements about future sales, their past behavior suggests they may take advantage of strong operating results and elevated share prices to realize additional gains. Investors should therefore remain vigilant regarding potential incremental executive selling during and after the unlock period.

Institutional Investors：For institutional shareholders such as Fidelity and Vanguard, their positions are primarily strategic or financial in nature. Most of these institutions accumulated their stakes either in the company’s early-stage rounds or during its Canadian listing period, giving them relatively low cost bases. With Galaxy’s share price up more than 100% this year, some degree of profit-taking cannot be ruled out. However, large institutions generally exhibit long-term investment behavior. Passive index funds (such as Vanguard) are even more inclined to hold their positions. Moreover, because these institutions could already trade their shares on the Toronto Stock Exchange prior to the U.S. listing, they were not strictly subject to lock-up restrictions. As a result, their willingness to sell is relatively moderate and driven primarily by their assessment of the company’s fundamentals. To date, there have been no reports of significant open-market selling by major institutional investors. On the contrary, some institutions appear to have increased their positions modestly in Q3. In addition, a newly introduced strategic investor—a large global asset management firm (not publicly named)—invested $460 million to purchase shares, signaling confidence in the company’s long-term value. Once its lock-up expires, it is unlikely to sell immediately; such an investor typically holds strategic equity positions over longer horizons, and its entry price of $36 per share is currently below market, implying an unrealized loss. Overall, there are no obvious signs that major external shareholders are eager to sell in the near term. That said, institutional investors may still adjust their positions tactically depending on market conditions. Monitoring upcoming Form 13G / 13F filings will be important for assessing institutional flows.

5. Financial Analysis

Revenue and Net Profit

Galaxy Digital’s performance has always been highly volatile. In 2022, the company recorded a full-year loss of about $1 billion, a sharp reversal from its $1.7 billion net profit peak in 2021. As markets recovered and the company adjusted its operations, Galaxy returned to profitability in 2023, posting $296 million in net income for the year. Entering 2024, results improved further but remained uneven: Q1 2024 delivered a record net profit of roughly $422 million, up 40% from the prior quarter, but earnings then retreated—Q2 2024 swung to a net loss of about $177 million amid a weaker crypto market, and Q3 2024 saw losses narrow to around $54 million. Q4 2024 rebounded with $174 million in net income, supported by strong market activity and certain one-off items, bringing full-year 2024 profit to $365 million. Momentum softened in the first half of 2025: Q1 2025 posted a net loss of $295 million due to declines in digital asset prices and impairments in the mining business, while Q2 2025 returned to profitability with $30.7 million in net income as the market recovered. Q3 2025 then became the strongest quarter since Galaxy’s listing, generating a record $505 million in net profit.

Overall, the company’s net profit has shown extreme volatility both year-over-year and quarter-over-quarter: after reversing its massive loss in 2022, Galaxy returned to profitability in 2023; following a strong earnings peak in the first half of 2024, performance fluctuated in the second half due to regulatory and market factors; the first half of 2025 saw losses again, but the third quarter of 2025 delivered the best results in the company’s history.

On the revenue side, Galaxy Digital’s reported “total revenue” surged by an order of magnitude after adopting U.S. GAAP in 2025, as the standard requires digital asset trading volumes to be recorded on a gross basis as revenue, with corresponding amounts recognized as “transaction expenses.” (For example, in Q1 2025, GAAP total revenue reached $128.56 billion, while transaction expenses totaled $130.59 billion—meaning the net economic contribution was minimal.)

Compared with the headline revenue figure, the adjusted gross profit metric—which strips out these gross-up effects—provides a more accurate reflection of Galaxy’s true revenue performance.

In terms of key drivers, the year-over-year and quarter-over-quarter swings in revenue and net profit are primarily influenced by several factors. First is the performance of digital asset markets and overall trading activity, which directly affects both the trading business and proprietary investment results: the 2022 bear market generated substantial unrealized losses, the 2023–24 rebound produced trading gains and mark-to-market appreciation, and the pullback in early 2025 again resulted in valuation losses. Second is the performance of major business segments: the trading division contributed most of the earnings growth during bull markets but produced losses during downturns; the mining segment expanded and contributed revenue in 2023–24, but strategic adjustments in 2025 led to short-term losses. Third are one-off events—such as regulatory penalty provisions and asset impairments—that materially affect quarterly GAAP profit and create divergences from underlying operating trends. Overall, Galaxy’s GAAP revenue figures are of limited informational value because they include large grossed-up trading flows and therefore need to be assessed alongside transaction expenses and adjusted gross profit; similarly, GAAP net income is heavily influenced by fair-value volatility and one-off charges, and these effects must be stripped out to evaluate recurring profitability.

From the EBITDA and adjusted EBITDA perspectives, Galaxy began disclosing both metrics in 2025 to further remove the effects of share-based compensation, fair-value changes, and other non-operating items, providing a clearer picture of cash-based operating earnings. For example, although GAAP net income in Q2 2025 was only $30.7 million, adjusted EBITDA reached $211 million, largely due to the add-back of significant investment losses and impairment charges that quarter, indicating improving core operating profitability.

Comparing GAAP and adjusted metrics shows that the company’s recurring earnings quality is gradually improving: it moved from operating losses in 2022 to positive adjusted profitability in 2023–24. Notably, adjusted gross profit and EBITDA were both strongly positive throughout 2024, demonstrating improved earnings power at the business-segment level. The gap between GAAP and non-GAAP results continues to stem mainly from volatile investment exposures and one-off items. As Galaxy reduces its proprietary risk exposure and focuses more on recurring revenue sources such as fee income and mining-related earnings, adjusted net revenue and adjusted gross profit are becoming increasingly representative of true operating performance. Although GAAP results were negative in the first half of 2025, adjusted EBITDA remained positive, indicating that the company’s underlying operations still have earnings strength.

To more accurately assess Galaxy Digital’s recurring profitability, it is necessary to strip out several one-off or non-recurring items that have caused short-term volatility in reported earnings.

On legal provisions, the company recorded a $166 million reserve in Q4 2024 related to a settlement with the New York Attorney General—part of a $200 million total legal cost tied to civil claims arising from Galaxy’s early-stage involvement with LUNA tokens. This was a one-time, non-operating loss that substantially compressed Q4 2024 net profit to the reported $174 million; excluding it, the company’s core profitability for the quarter was materially stronger.

On asset impairments and disposal losses, in Q1 2025, the company incurred roughly $57 million in charges associated with winding down its mining machines and shifting toward a data-center strategy, including the decommissioning of Helios mining equipment. This expense was also non-recurring and will not repeat once the new data-center operations ramp up.

Regarding fair-value movements in trading positions, as a digital-asset investor and market maker, Galaxy’s proprietary asset and liability valuations introduce significant and unsustainable volatility into quarterly earnings. The $1 billion net loss in 2022 largely reflected the collapse in the value of its investment portfolio, while Q4 2023 recorded substantial gains as those holdings rebounded. Similar patterns appeared in 2024: the extraordinary $422 million Q1 profit was partly driven by unrealized gains from rising token prices, and the Q2 loss stemmed from mark-to-market declines during the market pullback. These investment-related gains and losses are highly volatile and unpredictable, and they do not represent the company’s underlying operating performance.

Taken together, removing these one-off effects reveals a healthier picture of Galaxy Digital’s recurring earnings quality. Excluding large investment swings and extraordinary charges, the company’s core businesses achieved consistent profitability during 2023–2024, reaching new highs in 2024 with strong and steady contributions from trading and foundational operations. Although headline net income in the first half of 2025 fluctuated due to market conditions and non-recurring losses, adjusted metrics remained positive, demonstrating resilience in the firm’s core operating engine; with the strong surge in Q3 results, full-year 2025 performance is on track to reach another record.

However, it is important to note that 2023–2025 coincided with an overall crypto bull-market cycle. Under the common four-year crypto-cycle framework, 2026 is expected to be a softer, downward-trending period for digital assets. While Galaxy performed impressively in the previous bear cycle, a renewed downturn would undoubtedly impose financial and operational pressure, posing meaningful downside risk to earnings.

6. Moats and Core Competitive Advantages

In the highly competitive and fast-evolving crypto finance and AI compute-infrastructure industries, Galaxy Digital’s rise and continued expansion are built upon a set of distinct moats and core advantages.

• Brand credibility and industry positioning: As one of the few digital-asset financial institutions listed on major public markets, Galaxy has established a strong reputation for professionalism and compliance. Founder Mike Novogratz’s public influence further reinforces the brand. Today, Galaxy sits firmly in the first tier of global digital-asset financial service providers and is often described as “the Goldman Sachs of crypto.” This positioning brings clear first-mover advantages: institutional clients often select Galaxy for large-ticket trades, and many traditional enterprises exploring crypto prefer Galaxy as their advisory and asset-management partner. The brand’s signaling effect significantly lowers client-acquisition cost and forms a barrier that competitors cannot easily replicate.
• Critical intangible assets and resource endowment: As discussed earlier, the current shortage in AI-related power supply stems not only from generation capacity but more critically from transmission and interconnection bottlenecks—new grid-connection approvals can take 2–4 years. Against this backdrop, Galaxy’s acquisition of the Helios mining facility—and with it the facility’s 800 MW interconnection permit—became a pivotal intangible asset enabling Galaxy’s entry into the data-center industry. This asset is also the fundamental reason CoreWeave was willing to sign a highly favorable triple-net lease agreement. Moreover, Helios is located in an area with abundant wind and solar resources, providing access to low-cost electricity and further strengthening Galaxy’s competitive edge.
• Comprehensive compliance advantages: From inception, Galaxy has embraced regulation, securing FINRA broker-dealer registration in the U.S. and OSC oversight in Canada, while building an internal culture of strong compliance and risk control. In 2025, the company completed redomiciling to the U.S. and listed on Nasdaq, voluntarily subjecting itself to even stricter regulatory scrutiny. Compared with offshore or non-listed competitors, Galaxy’s regulatory posture allows it to serve a broader pool of institutional capital (e.g., U.S. pension funds and endowments) and to collaborate with traditional financial institutions (such as co-launching ETFs with State Street and Invesco). Compliance also reduces operational risk: during the 2023–2024 industry shake-ups, many unregulated platforms were hit hard, while Galaxy remained unscathed and settled its legacy LUNA investigation for USD 200 million, clearing past overhangs. A strong regulatory relationship and a solid compliance record form the foundation of Galaxy’s stable growth and constitute a moat that is difficult to challenge.
• High client stickiness through integrated services: Galaxy provides institutional clients with a full-stack suite—spot and derivatives trading, custody, lending, asset management, and advisory. This ecosystem dramatically increases client stickiness. For example, a corporate client may entrust Galaxy with asset management, borrow liquidity when needed, and execute hedging strategies through Galaxy’s trading desk—creating interconnected service workflows that are not easily portable. Galaxy’s data shows that its client retention and repeat-business rates rank among the highest in the industry. In addition, the company strengthens client relationships through strategic investments and partnerships — for example, after investing in SharpLink, Galaxy also became its asset manager, and collaborations with platforms like Fireblocks give Galaxy access to thousands of potential clients. These factors create a powerful network effect: the more clients Galaxy has, the richer its service offerings become, and the better the services, the more clients it attracts. This integrated financial-platform positioning sets Galaxy apart from single-product competitors and makes it, in the eyes of clients, a “one-stop crypto bank,” thereby forming a highly sticky customer moat.
• Capital-raising and capital-markets capability: Galaxy is highly skilled at using capital-market tools to support its growth. It raised money through a public listing early on and later completed multiple successful follow-on offerings to fund expansion. At key strategic inflection points, the company attracted substantial equity investments from top-tier asset managers as well as large-scale debt financing — evidence of strong market confidence in its leadership and business model. By contrast, many peers struggled to raise capital during bear markets and were even forced to scale back operations. Galaxy’s strong reputation allowed it to maintain ample “dry powder,” which itself functions as a competitive moat: it ensures the company always has resources for innovation and expansion, and gives it the ability to acquire distressed assets at attractive prices (such as purchasing the Helios mining facility at a discount). Its solid financial strength further boosts client confidence, especially in custody and lending businesses, where sizable proprietary capital serves as an important backstop. In short, Galaxy’s capital markets capabilities enable it to remain resilient through industry cycles, capitalize on opportunities, and build long-term competitive advantages.

Taken together, Galaxy Digital’s regulatory credibility, client network, integrated ecosystem, and financial strength form a multilayered and sustainable competitive moat. These advantages give it a clear edge over both established and emerging competitors such as Coinbase and Bakkt, and are key reasons investors grant it a valuation premium. That said, the company must continue reinforcing and extending these strengths — investing in technology to enhance trading and custody security, maintaining strong regulatory relationships, and exploring new synergies between AI and finance — to stay ahead in the evolving competitive landscape.

7. Key Risks and Challenges

Despite its favorable outlook, Galaxy Digital still faces multiple medium- to long-term risks and challenges that investors should monitor closely:

• Regulatory and policy risk: The regulatory environment for digital assets remains complex and fluid, and any tightening could negatively impact Galaxy’s operations. For example, delays in passing a U.S. stablecoin bill or prolonged hesitation by the SEC to approve new spot Bitcoin ETFs could hurt market sentiment and slow business growth. Globally, inconsistent regulations across jurisdictions also complicate cross-border compliance. More critically, as a publicly listed company, Galaxy faces reputational and financial damage if it becomes involved in regulatory inquiries or litigation. Although the company has resolved most of its historical LUNA-related issues through a USD 200 million settlement, regulatory and compliance risk remains a Damoclean sword. Should any DeFi activity involving Galaxy later be deemed unlawful, or if a custody-related security incident occurs, regulatory repercussions could follow. Galaxy must therefore continue investing in compliance and sustaining constructive communication with regulators to balance innovation with oversight.
• Market volatility and cycle risk: Galaxy’s business is highly exposed to digital-asset market conditions and cannot fully escape cyclical swings. The crypto market is characterized by pronounced bull-bear cycles; large price swings directly impact Galaxy’s trading volumes, asset-management fees, and proprietary investment results. As seen in the 2022–2023 downturn, the company suffered heavy losses and shrinking AUM. Should Bitcoin or other major assets fall sharply again or remain subdued for an extended period, trading and investment revenue will inevitably come under pressure. Although the company is expanding its recurring-revenue base, profitability is still heavily skewed toward trading, leaving Galaxy meaningfully dependent on market cycles. Investors should be prepared for significant fluctuations in financial performance — short-term volatility is inherent to its business model.
• Overlapping crypto and AI-infrastructure cycle risk: Galaxy is now strategically tied to two highly volatile industries: crypto and AI. Beyond crypto cycles, AI compute infrastructure also faces supply-demand cycles and technology-upgrade risks. Today’s strong demand for AI training and GPU shortages creates an attractive near-term outlook for data-center leasing. But if AI enthusiasm cools over the next two to three years or competition intensifies, compute pricing could fall, and major tenants such as CoreWeave may face business pressures. Tenant distress or default would hurt Galaxy’s compute-business cash flow. Even with stable leases, rapid hardware innovation may require continuous capital expenditure — failure to upgrade could lead to competitiveness loss. AI training demand itself is cyclical; compute growth may slow once the current wave of large-model training plateaus. Given Galaxy’s sizable investment in Helios, any shortfall in expected compute demand could lead to overcapacity or weaker-than-expected rental income. Energy costs and policy changes (e.g., power restrictions, carbon taxes) add further uncertainty. In short, Galaxy is shifting from being exposed to a single industry cycle to being exposed to two, mitigating some risks but introducing new ones, requiring forward-looking planning and adequate buffers.
• Execution and expansion-management risk: The company is in a phase of multi-track expansion, and the rollout of new businesses and regional growth raises the bar for execution and management. As its investment-banking and asset-management segments scale quickly, competition for top financial-industry talent intensifies. Galaxy must compete with Wall Street firms to attract and retain high-caliber professionals while maintaining its culture and service standards. Large projects such as Helios demand exceptional project-management capabilities — an 800MW data-center buildout is unprecedented for the company and involves supply-chain coordination, construction safety, and schedule control. Any delays or cost overruns could weaken returns. Although progress is currently on track, inherent engineering and ramp-up risks remain. New platforms like GalaxyOne, which target high-net-worth clients, also require investment in customer support and technical infrastructure to avoid service-quality issues that could harm the brand. Global expansion adds further complexity: offices in Europe and the Middle East must adapt to local regulations and markets, and remote oversight increases operational risk. Rapid expansion without matching governance and controls could lead to internal-control gaps or strategic missteps. Strengthening internal governance, IT systems, and risk-management capabilities will be essential to avoid the “growth trap.”
• Competitive risk: Galaxy operates in an extremely competitive landscape, with rivals ranging from traditional financial giants to emerging crypto-native firms. In trading, Coinbase is aggressively expanding institutional services such as OTC and prime brokerage; global players like Binance are also targeting institutional clients. In asset management, Grayscale, Fidelity Digital Assets, and others compete for institutional allocations. In compute infrastructure, major players abound: Amazon and Google offer cloud-GPU services, and traditional data-center REITs or miners may shift into AI infrastructure. Although Galaxy currently enjoys strong differentiation, future competitive pressure cannot be ruled out — for example, if Coinbase fully expands into investment banking or lending, it could divert part of Galaxy’s institutional client base. Meanwhile, emerging DeFi innovations or decentralized-custody technologies could fundamentally reshape existing business models and pose disruptive threats. Galaxy must therefore remain vigilant, continuously innovate, and maintain product and service leadership. Strategic alliances or acquisitions — such as the earlier (ultimately unsuccessful) attempt to acquire BitGo — may also be necessary to strengthen its competitive positioning. Overall, competitive dynamics require Galaxy to be agile and proactive in order to remain ahead.
• Other risks: Macro-economic and liquidity conditions also affect Galaxy’s performance. For example, while the end of a global rate-hike cycle or moderate rate cuts may provide short-term support to risk assets and boost crypto sentiment, persistently low interest rates could reduce stablecoin-related yield opportunities. Geopolitical shocks (e.g., sudden bans on crypto trading in certain jurisdictions) could also affect the market. Technology and security risks remain material: despite robust controls, a major hacking incident or smart-contract exploit resulting in asset loss would severely damage trust and reputation. Galaxy remains vigilant, continuously upgrading its security infrastructure and maintaining insurance coverage. Finally, key-person risk deserves mention. CEO Mike Novogratz plays a central role in shaping strategy and market confidence. Should he become unable to serve, or if the executive team experiences instability, the company could face uncertainty. That said, Galaxy has been institutionalizing its governance structure and diversifying leadership, which should allow operations to continue even under a leadership transition.

In summary, Galaxy Digital must navigate regulatory, market, operational, and competitive risks as it grows. The company’s initiatives — increasing recurring-revenue share, pursuing regulated listings, securing long-term compute leases, and enhancing risk controls — help mitigate these risks to some extent. However, investors should maintain realistic expectations and recognize that rapid growth naturally comes with elevated volatility. As management has noted: “Macro and industry uncertainties remain; short-term volatility risk is high.” Only through disciplined risk management and steady execution across cycles can Galaxy achieve its long-term value.

8. Valuation Analysis

Galaxy Digital’s business is clearly divided into a digital-asset segment and an AI computing segment, each following a very different valuation logic. We therefore adopt a sum-of-the-parts (SOTP) approach to value GLXY.

Business Segmentation and 2025 Performance Estimates

Digital Asset Trading & Financial Services: Galaxy’s core operations include global markets trading, OTC trading, crypto brokerage, investment banking advisory, and both active and passive digital-asset management. The earnings profile of this segment resembles that of a crypto investment bank combined with a trading platform. For the first three quarters of 2025, this segment reported adjusted gross profits of –$203 million, $299 million, and $728 million, totaling approximately $824 million, though the results remain highly volatile due to inherent fluctuations in the cryptocurrency market.

It is evident that prior to Q3 2025, Galaxy’s adjusted gross profit closely tracked the quarterly price movements of Bitcoin (BTC). In Q1 and Q4 2024, when BTC posted gains of over 40%, Galaxy’s adjusted gross profit also reached peak levels. Conversely, during Q2 2024 and Q1 2025, when BTC declined, Galaxy recorded negative adjusted gross profit for those quarters. Q3 2025, however, stands out as a clear exception: despite BTC rising only 6.44%, Galaxy generated a record $728 million in adjusted gross profit. As discussed above, two major drivers were the sale of 80,000 BTC and Galaxy’s strong participation in the DAT boom. While the current enthusiasm for DATs has cooled significantly, Galaxy’s ability to continually strengthen its position as the preferred trading platform for institutions and large investors could help increase recurring revenues and partially offset the cyclical volatility of the crypto market—thereby improving earnings stability.

Galaxy’s last-twelve-months (LTM) adjusted gross profit stands at $1.284 billion, which we use as the basis for valuation comparisons below.

AI Compute & Data Centers: In 2022, Galaxy acquired the Helios data-center campus in Texas and began a strategic shift in 2024 toward high-performance compute (HPC) hosting, gradually exiting proprietary Bitcoin mining. In 2025, this segment has not yet contributed meaningful revenue—the company expects to begin recognizing revenue from Phase I of its lease agreement with CoreWeave in the first half of 2026. CoreWeave has secured, in two phases, 526 MW of critical IT load at the Helios campus (within a total power capacity of 800 MW; due to high availability and redundancy requirements, critical IT load must be lower than total electrical load) for AI/HPC compute, under a 15-year lease. According to disclosures, this long-term contract could generate approximately $1 billion in annual revenue at full utilization. Because 2025 is a transitional year focused on construction and reconfiguration, Helios generated only minimal gross profit—e.g., around $2.7 million in Q3, mostly from liquidating remaining Bitcoin mining machines and related assets. Accordingly, we reference 2026–2027 operating income for valuation purposes, assuming annualized revenue reaches the $500 million–$1 billion range starting in 2027 (roughly $300 million from full Phase I plus partial contributions from Phase II). Most costs for this segment are currently capitalized, and thus 2025 financials show no significant revenue or EBITDA contribution.

Comparable Valuation Multiples

To value the two major business segments, we selected publicly listed U.S. peers in the respective fields and compared their enterprise-value multiples based on the latest twelve-month (LTM) financials, all denominated in USD.

Comparable Companies for the Digital Asset Financial Services Segment

Representative peers include Coinbase (COIN) and Robinhood (HOOD), as fully comparable firms such as FalconX and Cumberland are not publicly listed. Among these, Coinbase and Galaxy currently share a similar positioning as crypto-native platforms, while Robinhood also covers equity trading and is entirely retail-focused. In contrast, Galaxy serves exclusively institutional clients, and Coinbase—although predominantly consumer-facing—also has a meaningful institutional business. Therefore, Coinbase is clearly the more appropriate peer for Galaxy.

From a valuation-metric perspective, Galaxy’s GAAP-reported revenue has become “distorted”: GAAP requires digital-asset trading volumes to be booked on a gross basis as revenue, with the corresponding amounts recognized as “transaction expenses.” As a result, any valuation comparison using revenue (sales) would essentially compare Galaxy’s gross trading volume with Coinbase’s net fee revenue—an inherently mismatched and non-comparable basis. We therefore require a metric with consistent economic substance across companies. Adjusted Gross Profit serves this purpose. Galaxy discloses Adjusted Gross Profit to remove the impact of direct transaction expenses, representing the net economic value generated from its trading and related businesses—akin to a net operating revenue concept. Coinbase does not directly report this metric, but we can approximate it by subtracting its transaction expenses from net revenue.

Using this approach, Coinbase’s net revenue from Q4 2024 to Q3 2025 totals approximately USD 7.37 billion, and its transaction expenses over the same period sum to about USD 1.119 billion. The difference implies an LTM “adjusted gross profit” of roughly USD 6.251 billion. Based on this, Coinbase is trading at an EV / Adjusted Gross Profit (LTM) of around 11x.

A summary of comparable company valuation multiples is provided in the table below.

Comparable Companies for the Compute Infrastructure Segment

For the compute-infrastructure segment, given the currently elevated demand, long development and build-out cycles, and relatively predictable future cash flows, the EV/EBITDA multiple is an appropriate metric for cross-company valuation comparison.

There are many relevant peers in this category, and we summarize them as follows:

CoreWeave (CRWV) as the upper-bound reference: CoreWeave’s $37.3 billion market capitalization demonstrates the massive demand in the AI compute market, and it currently enjoys a high 18–20x EV/EBITDA valuation. Applied Digital (APLD) is the closest direct comparable: APLD likewise focuses on building physical infrastructure leased to hyperscale clients (including CoreWeave), and its market cap has surpassed $6.5 billion with an EV/EBITDA in the 15–18x range, making it the most suitable comparable for Galaxy. CORZ & WULF as the lower-bound reference: these two companies still retain substantial self-mining exposure to Bitcoin, making their valuations sensitive to BTC price volatility; their operating model (OpCo) is more asset-heavy, and they currently trade at 10–14x EV/EBITDA. Galaxy’s Helios is a pure NNN lease (PropCo) model with a 90% margin, far higher than CORZ’s hosting business (~50%), so its valuation multiple should be meaningfully higher than CORZ. REITs (DLR/EQIX) as the terminal benchmark: DLR and EQIX trade at 24–26x EBITDA. As Helios enters a stable operating phase, its long-term valuation framework may shift from a “mining-company-in-transition” narrative toward that of a “stable REIT.”

Galaxy’s compute-infrastructure segment EBITDA estimate:

• Annualized revenue: $1 billion. This figure comes from management’s revenue guidance and is primarily backed by the long-term contract signed with CoreWeave. Although the full contract details have not been disclosed, we can validate the number by comparing it with industry peers. For instance, APLD’s partnership with CRWV involves a similar 15-year lease across 250 MW of critical IT load, with a total contract value of roughly $7 billion, implying an average $467 million in annual revenue, or about $1.87 million per MW per year. Similarly, TeraWulf has two 10-plus-year agreements with Fluidstack and Google, translating to $1.85 million and $2.26 million per MW per year, respectively. Under Galaxy’s agreement with CoreWeave, 526 MW of critical IT load yields $1 billion in annual revenue—equivalent to $1.9 million per MW per year. This aligns closely with peer pricing and supports the credibility of Galaxy’s revenue guidance.
• EBITDA margin:90% (NNN lease structure, with the tenant bearing OpEx and Galaxy carrying minimal operating costs).
• Ramp-up timeline: Phase 1 (25%) begins operations in 1H 2026, Phase 2 (50%) in 2027, and Phase 3 (25%) from 2028 onward.

Accordingly, we assume that in 2027, Galaxy can generate $1B × 75% × 90% = $675 million in EBITDA, which we use as the basis for valuation.

Segment Valuation and Total Value Assessment

Based on the above performance estimates and comparable multiples, we value Galaxy Digital’s two major business segments separately and then sum them to derive the company’s total enterprise value (EV). We then factor in Galaxy’s net cash and investment assets to arrive at the equity value, which we compare with the current market capitalization.

① Valuation of the Digital Asset Financial Services Segment: As discussed above, we use EV / Adjusted Gross Profit (LTM) for comparison. Galaxy’s current LTM adjusted gross profit is $1.284 billion. Using Coinbase’s EV / adjusted gross profit multiple of roughly 11× as a benchmark—and considering that Galaxy’s business is predominantly institutional, smaller in scale, and far more volatile and dependent on crypto market conditions—we apply a meaningful discount. While crypto market swings do affect Coinbase’s profitability, its adjusted gross profit has consistently remained positive and relatively stable compared with Galaxy’s; by contrast, Galaxy posted a negative adjusted gross profit in Q1 this year during a market downturn, to say nothing of net income. Therefore, we apply a significantly discounted valuation range of 5–7× EV / Adjusted Gross Profit. This yields an estimated segment enterprise value of $6.42–$8.988 billion, with the midpoint of $7.7 billion being a reasonable choice. This valuation reflects market recognition of Galaxy’s growth potential and earning power in digital financial services but applies a modest discount relative to pure-play exchange leaders, acknowledging Galaxy’s smaller scale, lower brand visibility, and higher performance volatility.

② Valuation of the AI Compute Infrastructure Segment: Since the segment has not yet generated meaningful revenue in 2025, we base valuation on contracted future earnings potential. As analyzed previously, we use $675 million in EBITDA for estimation and apply an EV/EBITDA multiple. Applied Digital—whose business model is closest to Galaxy’s Helios—trades around 15×, while CORZ, operating under a less favorable model, trades near 12×. Considering Helios is still under construction and contract ramp-up is gradual, we adopt a conservative 12× multiple, generating an EV estimate of $8.1 billion for the segment.

③ Adjustment for Other Asset Values: As of Q3 2025, Galaxy held substantial balance-sheet investments and cash: approximately $1.91 billion in cash and stablecoins, and $2.14 billion in digital assets and long-term investment positions. The company also secured an additional $325 million in net equity financing in Q4 for the Helios build-out. After deducting the portion of Helios project-finance debt already drawn (about $430 million as of the end of Q3), Galaxy’s net cash and investment assets total approximately $3.5–3.8 billion. Since our segment-based valuation above does not include these assets (e.g., proprietary crypto holdings or fair-value investments, which are recorded in equity on financial statements), we need to add them back when calculating total equity value. For simplicity, we use $3.6 billion as an approximate value for net cash and investment assets.

Comparison of Valuation Results with Current Market Cap: In summary, we derive a segment valuation of $7.7 billion for Galaxy’s digital asset financial services business and $8.1 billion for its AI compute infrastructure business, totaling $15.8 billion. Adding net assets results in an estimated total equity value of approximately $19.4 billion. In contrast, Galaxy’s current market capitalization is $10.1 billion, representing a 48% discount to our sum-of-the-parts valuation.

Galaxy Digital’s market valuation is significantly lower than the sum of its parts, and the main reasons may include:

First, the company’s core businesses remain highly dependent on the cryptocurrency market, with profitability closely tied to the digital asset cycle. Based on the traditional four-year crypto market cycle, the industry may enter a downturn starting in 2026. Historical data show that Galaxy’s profitability has weakened sharply in previous bear markets, and the company has even fallen into losses. Although the Q3 2025 earnings report demonstrates some degree of counter-cyclical resilience, its sustainability has yet to be validated by the market.

Second, while the Helios AI data-center transition project carries long-term potential, it is still in the build-out phase and has not yet generated material revenue. The project faces multiple execution risks—including construction progress, technological implementation, and market demand—with a clear lag and uncertainty in realizing returns.

Given these factors, investors tend to apply conservative valuation approaches to companies that face both industry-cycle volatility and business-transition challenges. They generally demand a higher risk premium for the uncertainty of future cash flows, resulting in a substantial valuation discount.