tl;dr
Galaxy, led by Mike Novogratz, is launching a crypto-native money-market fund to challenge traditional finance, targeting Ethereum, Solana, and Stellar with a phased rollout. Anchorage Digital will safeguard assets. The fund aims to combine crypto efficiency with traditional stability, focusing on i...
Galaxy, the digital asset investment firm led by Mike Novogratz, is stepping into the tokenized fund arena with a bold move: a crypto-native money-market fund designed to challenge the status quo. The New York-based company, known for its aggressive bets on digital assets, is set to debut the fund in the coming months, with plans to launch it on Ethereum, Solana, and Stellar blockchains. However, sources say it won’t debut on all three networks simultaneously, signaling a phased rollout to test the waters. Anchorage Digital, a leading crypto custodian, will safeguard the fund’s assets—a nod to the importance of security in this nascent space.
This isn’t the first foray into tokenized finance. BlackRock’s BUIDL fund, now valued at $2.2 billion, and Franklin Templeton’s BENJI token have already paved the way, offering blockchain-based access to traditional assets. But Galaxy aims to differentiate itself by blending the efficiency of crypto with the stability of traditional finance. “The overarching ambition is to use the power of tokenization to offer instant liquidity,” one source said, hinting at innovations yet to come. The firm has been closely watching how investors interact with existing tokenized funds, seeking to refine the user experience and address gaps in accessibility and functionality.
The plan underscores a broader trend: institutional players are racing to harness blockchain’s potential. While BUIDL debuted on Ethereum before expanding to Solana in March, Galaxy’s multi-chain strategy suggests a desire to cater to diverse ecosystems. Solana’s speed and low fees, Ethereum’s dominance, and Stellar’s focus on cross-border payments each offer unique advantages. Yet the decision to delay a full rollout highlights the complexities of balancing innovation with risk management.
Galaxy’s entry also raises questions about competition. BlackRock’s BUIDL has already captured significant attention, with its $2.2 billion market cap reflecting investor appetite for regulated, tokenized assets. But Galaxy’s pedigree—backed by Novogratz, a veteran of both traditional and crypto markets—could attract a different audience. The firm’s emphasis on “crypto-native” design implies a focus on seamless integration with DeFi tools, potentially appealing to tech-savvy investors seeking fluidity between traditional and digital assets.
Despite the buzz, challenges remain. Regulatory clarity, market volatility, and the need for robust infrastructure are hurdles all tokenized funds must navigate. Galaxy’s partnership with Anchorage Digital, which has weathered crypto’s ups and downs, may provide a buffer against some risks. Yet, as the firm prepares to launch, it will need to prove that its vision for instant liquidity and innovation isn’t just ambitious—it’s achievable.
For now, the crypto world watches closely. Will Galaxy’s fund redefine what’s possible in tokenized finance, or will it face the same pitfalls as its predecessors? One thing is clear: the race to bridge traditional and digital finance is only just heating up.