Galaxy Asset Management hits $10 billion milestone; CEO expects Bitcoin correction

Galaxy Asset Management surpassed $10 billion in Assets under Management (AUM) for the first time on Feb. 29, 2024.

Galaxy Digital Holdings’ institutional investing division credited the milestone to a growing enthusiasm among institutional investors for digital assets. Mike Novogratz, CEO of Galaxy Digital, announced this accomplishment on March 19 on X, characterizing it as an ongoing effort to broaden investor access to the digital economy.

Galaxy Asset Management has witnessed a significant increase in its AUM over the past year, more than tripling its value. The firm asserts that this was the result of a number of investment strategies, such as “passive, active, and venture investment strategies,” one of which was the Invesco Galaxy Bitcoin ETF (BTCO).

Interestingly, BTCO has experienced relatively modest inflows of $175 million to date, trailing behind only the Franklin Bitcoin ETF (EZBC) and the WisdomTree Bitcoin Fund (BTCW), both of which were introduced in mid-January and have recorded even lower inflows.

On March 18, the company also reported a preliminary AUM of $10.1 billion, up 24.8% from February. The investment firm pointed out that while net outflows from a specific “opportunistic mandate” acted as a brake on further growth, the general market growth was the main driver behind this hike.

Despite the recent milestone, Galaxy Digital’s stock (GLXY) saw a 4% decline to close at $12.80 in after-hours trading. However, over a longer timeframe, the stock price is up by 23.5% since the start of the year, buoyed by the approval of spot Bitcoin ETFs in mid-January. Yet, it remains significantly below its all-time high of $40 from November 2021.

Along with its successes in asset management, Galaxy Digital is currently waiting for regulatory clearance to launch a spot Ethereum ETF; a decision is anticipated by July 5. The firm was founded in 2018 and includes Galaxy Digital Holdings’ Global Markets and Digital Infrastructure Solutions divisions. It is led by Steve Kurz, who serves as the Global Head of GAM.

The milestone for Galaxy Digital coincided with Bitcoin ETFs recording massive inflows. In a Forbes interview, Novogratz predicted that this development will contribute to launching Bitcoin’s subsequent wave of adoption.

On the contrary, Novogratz forecasts that Bitcoin’s price could go through a correction and fall as low as $50,000. The projection appears to be accurate as the value of Bitcoin has dipped from its peak of $73,580 on March 14 to $63,877 at the present evaluation.

In a more recent interview with CNBC, he detailed that ongoing net inflows into the nine U.S. spot Bitcoin ETFs will likely propel BTC’s price higher. On the flip side, a transition to net outflows from these ETFs could mark the onset of the first significant market correction.

This trend, Novogratz pointed out, is now a critical watchpoint for traders tracking the inflows and outflows of spot Bitcoin ETFs.