By Josiah Wilmoth
Billionaire ex-hedge fund manager Mike Novogratz has announced plans to develop a merchant bank that sources familiar with the matter are calling the “Goldman Sachs of crypto.”
Ex-Fund Manager to Launch ‘Goldman Sachs of Crypto’
Novogratz, a former chief investment officer at Fortress who has personally invested hundreds of millions of dollars in cryptoassets, announced this week the creation of Galaxy Digital, a “full service, digital assets merchant” bank.
A source familiar with the matter described the proposed bank as a “Goldman Sachs of crypto,” according to a Bloomberg report. Novogratz is said to be moving all of his blockchain investments to Galaxy, which amount to approximately $400 million in cryptoassets as well as equity stakes in startups such as Bitstamp, Ripple Labs, and Xapo.
According to a press release, Galaxy will have four core business segments. The firm will trade cryptoassets and seek to capitalize on cross-exchange arbitrage opportunities. It will also make equity and venture investments across the blockchain ecosystem, which includes participating in initial coin offerings (ICOs) and token generation events (TGEs). Moreover, Clients will be able to take advantage of the firm’s advisory services. Finally, the firm will provide asset management services on behalf of limited partners.
A Buyout, a Merger, and a Fundraising Round
Galaxy will be located in Ontario and will be publicly listed on TSX Venture Exchange (TSX-V) following a series of transactions including both a multi-hundred million dollar fundraising round and a reverse takeover of Bradmer Pharmaceuticals Inc., which is currently listed on TSX-V and will change its name to Galaxy Digital Holdings.
Before Galaxy can merge with Bradmer, however, it must gain entry into the Canadian market through a purchase of Vancouver-based crypto startup First Coin Capital Corp.
If all goes as planned, these transactions should be completed by the end of the first quarter.
This is not the first foray into the cryptoasset ecosystem for Novogratz, who has long been a proponent of cryptocurrencies and blockchain technology. Previously, he had intended to launch Galaxy Investment Partners, a $500 million cryptoasset hedge fund, but he abruptly shelved those plans last month, citing concern over the current market conditions.
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Featured Image from Bloomberg