Galaxy Digital’s New Venture Fund: A Major Step Forward

Galaxy Digital has announced a significant milestone in its growth trajectory by closing a $175 million venture fund, its first to incorporate outside capital. This fund exceeds its initial target of $150 million and represents a pivotal moment for the company, which has historically relied solely on its own resources for venture investments.

The Strategic Shift Towards Outside Capital

General Partner Mike Giampapa highlighted the fund’s purpose: supporting early-stage companies focused on stablecoins, decentralized finance (DeFi) applications, and various blockchain innovations that transcend mere speculation. “You’re seeing this fundamental shift from more speculative use cases of blockchains to something that’s much more…tangible,” Giampapa remarked in a conversation with Fortune. This statement encapsulates the evolving dynamic within the crypto sector, where sound, practical applications are becoming increasingly prioritized over speculative ventures.

Learning from Industry Challenges

The timing of this venture expansion is noteworthy, particularly following the collapse of FTX, a major player in the crypto space. Giampapa revealed that Galaxy had long aspired to expand its venture operations beyond in-house investing but felt the environment was right to make this leap post-FTX. He stated, “Quietly, we had this stablecoin revolution. While the industry was getting our feet underneath us again, it became obvious that we wanted to take our venture franchise to the next level.”

Fund Composition and Deployment

Galaxy Digital anchors the new fund, holding both general and limited partner stakes. Although Giampapa declined to name other investors, he described them as prominent institutional players, including family offices and fund-of-funds connected to Galaxy’s asset management clients. Since announcing the fund’s initial close of $113 million in July 2024, Galaxy has already allocated $50 million to promising ventures like Monad—focused on performance-oriented blockchain technology—and Ethena, which specializes in yield-bearing stablecoins.

A Growing Crypto Conglomerate

Founded in 2018 by former Goldman Sachs partner Mike Novogratz, Galaxy Digital has metamorphosed into a multifaceted crypto conglomerate. Today, it boasts a robust presence in asset management, Bitcoin exchange-traded funds (ETFs), mining, and now venture investing. As of May, the company was listed on Nasdaq, showcasing its growth and ambition. According to reports, Galaxy holds approximately $7 billion in assets under management, a testament to its expanding influence in the crypto ecosystem.

Navigating Challenges and Opportunities

Despite its substantial growth, Galaxy has faced its share of challenges. In the first quarter of 2025, the firm reported a loss of $295 million, attributed largely to declining market prices and restructuring in its mining operations. However, the company remains resilient, focusing on long-term strategic investments in innovative blockchain technology.

Notable Events and Impact

Galaxy Digital has also made headlines for its impressive trading day on November 5, 2024, coinciding with the U.S. presidential election. On that day, Novogratz’s net worth surged by about 15%, roughly increasing by $600 million to an estimated $4.6 billion. This event underscores the intertwined nature of the broader financial landscape with the crypto market, showcasing how external factors can significantly influence market dynamics.

Through its latest venture fund, Galaxy Digital is poised to become a formidable player in shaping the future of blockchain technology and early-stage startups. By embracing outside capital and focusing on practical applications, the firm is leading a transformative wave in the crypto world, one that aims to build a more sustainable and innovative ecosystem.