Mike Novogratz’s Galaxy Digital Will Acquire Celsius Owned Custody Platform GK8

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Galaxy Dig­i­tal has won the auc­tion for GK8 – a cryp­to cus­tody plat­form to be sold as part of bank­rupt­cy pro­ceed­ings for the insol­vent cryp­to lender Celsius. 

Galaxy will uti­lize GK8’s cus­tody solu­tion as it devel­ops Galaxy­One – its own insti­tu­tion­al prime offering. 

  •  As announced by Galaxy on Fri­day, GK8 founders CEO Lior Lamesh and CTO Sha­har Shamai will remain to lead Galaxy’s cus­to­di­al tech busi­ness, while pro­vid­ing self-cus­tody solu­tions for Galaxy­One as well. 
  • “With the back­ing of Galaxy, we aim to intro­duce new and excit­ing offer­ings to the indus­try that show­case a com­bi­na­tion of Galaxy’s best-in-class ser­vices and GK8’s cryp­tog­ra­phy, secu­ri­ty, and unpar­al­leled R&D skills,” said Lamesh on the deal.

  • Com­pa­ny CEO Mike Novo­gratz said on Fri­day that GK8’s acqui­si­tion marked a “cru­cial cor­ner­stone” for dig­i­tal asset stor­age with Galaxy. Galaxy­One already planned to offer cryp­to trad­ing, lend­ing, mar­gin, and deriv­a­tives prod­ucts for Galaxy’s insti­tu­tion­al investors. 
  • “Adding GK8 to our prime offer­ing at this piv­otal moment for our indus­try also high­lights our con­tin­ued will­ing­ness to take advan­tage of strate­gic oppor­tu­ni­ties to grow Galaxy in a sus­tain­able man­ner,”  he said.

  • The trans­ac­tion is set to expand Galaxy’s head­count by 40 peo­ple, and expand its world­wide reach by adding an office in Tel-Aviv. 
  • Cel­sius acquired GK8 for $115 mil­lion last year but went bank­rupt in ear­ly July as the crash­ing cryp­to mar­ket pushed its lend­ing mar­gin posi­tions to the lim­it. FTX con­sid­ered a res­cue deal for Cel­sius at the time but walked away after see­ing the state of its bal­ance sheet. Today, FTX too has gone bank­rupt, along­side oth­er cryp­to lenders like Voy­ager and BlockFi. 
  • In the after­math of Cel­sius’ col­lapse, Mike Novo­gratz admit­ted that the cryp­to indus­try was more lever­aged than he thought.
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