Galaxy Digital has invested $44 million in an institutional cryptocurrency custody platform to leverage its own asset storage and management capabilities.
Mike Novogratz’s cryptocurrency investment firm has completed the acquisition of GK8, which has developed its own patent-pending cryptocurrency custody technology aimed at providing secure asset management for institutional users.
The service specializes in providing cold vault technology that allows transactions to be carried out without an internet connection. Its own Multi-Party Compute (MPC) storage provides the ability to automate transactions, and the service also provides access to Decentralized Finance (DeFi), tokenization, NFT and trading networks.
Novogratz’s statement highlighted increased investor demand for custody services as a key reason for the acquisition. GK8’s data storage solutions and wallet technologies will be integrated into Galaxy Digital’s upcoming flagship brokerage platform GalaxyOne.
The business deal will see Galaxy add a Tel Aviv office to its organization, with nearly 40 GK8 employees becoming part of the wider group. GK8 founders Lior Lamesh and Shahar Shamai remain after the acquisition to lead Galaxy’s custody technology offering.
Related: Mike Novogratz calls Helios a “transformative acquisition” for Galaxy
GalaxyOne is touted as offering a wide range of cryptocurrency financial services to institutional users at its launch. This will include trading, lending, derivatives, cross-portfolio margining as well as depository offerings managed by GK8.
Galaxy doubled its investment in the cryptocurrency mining sector in December 2022, notifying acquisition of major mining operation Argo Blockchain for $65 million. The mining firm had to sell its Helios mining rig to avoid bankruptcy during a tough year for the sector.