Galaxy Digital Holdings, led by Mike Novogratz, has officially acquired cryptocurrency custodian BitGo Inc. for $1.2 billion in cash and stock.
To fund the acquisition, Galaxy will pay $265 million in cash and issue 33.8 million shares. Shareholders in BitGo would own 10% of the stock. Galaxy’s product line and global scope will be expanded as a result of the agreement.
In a statement, Galaxy Digital’s chief executive officer and founder, Michael Novogratz, said, “The acquisition of BitGo establishes Galaxy Digital as a one-stop-shop for institutions and significantly accelerates our mission to institutionalize digital asset ecosystems and blockchain technology.”
Mike Belshe, an engineer who previously worked on Chrome by Google, created cryptocurrency prime broker BitGo in 2013. He will join Galaxy as the company’s deputy chief executive officer and join the board of directors.
In a statement, Belshe said:
“Joining Galaxy Digital represents an exciting new chapter for our firm, as our current clients gain access to a wide range of financial solutions.”
According to a press release, BitGo has over 400 institutional customers, more than $40 billion in assets under management, and represents over 150 exchanges. Every month, the company processes about 30 billion transactions and manages the custody of over 400 coins and tokens.
It’s the second high-profile crypto acquisition in the last few days. Coinbase Global Inc., the newly public crypto company, acquired Skew, a cryptocurrency derivatives data analytics and trade execution tool, at the end of April.
The crypto-sphere has expanded in recent months as institutional and retail investors have become more interested in digital assets as prices have risen dramatically. Bitcoin, the most common digital currency, has increased by more than 500% in the last year. Over the same period, the Bloomberg Galaxy Crypto Index, which monitors various cryptocurrencies, has increased by nearly 800%.