A recent report released by Galaxy Digital Holdings found that Novogratz’s losses were even greater than previously thought. According to the company’s financiers, the blame is “the decline in trading volumes on the crypto market”.
Crypto volatility is to blame
The statistics are pretty disappointing. In the second quarter, the company posted a loss of $ 175.8 million against a cumulative profit of $ 35.3 million for the same period last year.
What’s more, this figure is in stark contrast to the company’s first quarter report; which posted a total net profit of $ 860 million earlier this year.
Despite this, the company’s press release notes an increase in trading activity and the volume of assets under management. At the moment, the volume of assets under the management of Galaxy Digital exceeded $ 1.6 billion; while the growth in the second quarter was 12%. Trading volumes increased by 90% at once.
“While the second quarter was characterized by significant volatility and macroeconomic factors hampering near-term results; our operating results continued to grow rapidly. We are talking about both the provision of liquidity and the volumes of execution of transactions for our clients; as well as the growth of the strategic investment portfolio”, the press release says.
The company will remain substantially profitable
The CEO stressed that the company will remain “substantially profitable” no matter what.
Novogratz writes: “It’s important to remember that the long-term distribution curve for cryptocurrencies is much higher than the business we are building. We see the battle for proliferation as difficult and more financially significant than short-term price fluctuations”.
Thus, the CEO of the company Mike Novogratz tried to reassure investors after a period of rapid decline in the cryptocurrency market in March this year.
Galaxy Digital achievements in recent months
At the time of the market decline; the bank paid more attention to venture capital investments in startups related to NFT. The company has completed venture capital deals with 14 collectible token (NFT) startups. The investment was $ 52 million. Novogratz said he was “very excited” about the investment in the Major League Baseball Candy Digital collectible platform, game developer NFT Mythical Games and the NFT Art Blocks platform.
Galaxy Digital’s major achievement over the past three months has been its partnership with Goldman Sachs. The bank acts as a liquidity provider for Bitcoin futures trading, conducting transactions of clients of the financial corporation through the CME stock exchange. Previously, Galaxy Digital analysts said that the traditional banking system and the gold mining industry each separately consume twice as much electricity as the Bitcoin network. We also note that Galaxy headcount increased significantly in the second quarter by 45% to around 220 worldwide. Recent Galaxy employees include Tim Grant, former CEO of Swiss company SIX Digital Exchange, as head of Europe and Jennifer Lee, director of human resources for the firm.