Galaxy Digital is exploring tokenization of its own stock and other traditional assets, with discussions already underway with the SEC.
Background
- Billionaire investor Michael Novogratz’s Galaxy Digital Holdings Ltd. is in active discussions with the U.S. Securities and Exchange Commission (SEC) about tokenizing its publicly traded shares and potentially other traditional securities.
- The firm, which manages approximately $7 billion in assets, met with the SEC’s crypto task force in March to explore registering Galaxy’s shares on a blockchain.
- Galaxy begins trading on Nasdaq this Friday, transitioning from its previous listing on Canada’s TSX Venture Exchange.
Why Should You Pay Attention?
- Galaxy’s move marks one of the first serious efforts by a major digital asset manager to integrate tokenized stocks into the U.S. regulatory framework.
- Tokenized securities are said to have faster settlement, greater transparency, and 24/7 trading, potentially transforming how retail and institutional investors access traditional financial markets.
- The firm’s strategy may influence broader adoption of tokenized real-world assets (RWAs), including ETFs, fixed income instruments, and equities.
Who Said What?
- Michael Novogratz, CEO of Galaxy:
“We are working with the SEC to tokenize stocks… They believe in crypto, they believe in the power of tokenized networks.”
- He added that while tokenization hasn't yet taken off at scale, “it’s really close” and could represent the next wave of financial innovation.
- SEC Crypto Task Force: Recently hosted a roundtable on tokenized assets, where participants likened the evolution of securities to the shift from vinyl to digital formats.
- Galaxy’s earlier efforts include tokenizing a 316-year-old Stradivarius violin to back a loan, showing its commitment to bridging blockchain with tangible value.
Zooming Out
- While institutions like BlackRock have begun experimenting with tokenized money-market funds, the total value of tokenized real-world assets on public blockchains is still modest at roughly $22.5 billion.
- Galaxy’s Nasdaq debut comes amid renewed enthusiasm in crypto equities. With platforms like Coinbase and Kraken also interested in tokenized stocks, Galaxy’s regulatory collaboration could set a precedent.
- Other firms such as eToro and Circle are also positioning for public listings as crypto markets rally. Novogratz remains optimistic, calling this “the beginning, not the finish,” as Galaxy rings the Nasdaq bell and sets its sights on a tokenized future.
