Terra-backer Galaxy Digital gives update on liquidity position

Mike Novogratz's Galaxy Digital released a company update on Friday that gives visibility into its capital and liquidity position amid a frenzied crypto market tied to the meltdown of cryptocurrency Luna and associated algorithmic stablecoin TerraUSD (UST). 

Galaxy Digital — an early backer of Terraform Labs and Luna — said in a release it "believes that the current digital asset and broader market conditions warrant providing shareholders, counterparties, and clients intra-quarter visibility regarding its capital and liquidity position, as well as its operating resilience."

The company said it has a liquidity position of about $1.6 billion, including $800 million in cash and an additional $800 million in cryptocurrencies. Meanwhile, quarter-to-date net comprehensive income is expected to come in at a loss of $300 million, a decline of 12% from March 31, according to the company. By way of comparison, the crypto market has declined by more than 37% year-to-date. 

The firm added that it has no exposure to algorithmic stablecoins.


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UST, an algorithmic stablecoin built on the Terra blockchain, unraveled this week, sending the price of Luna to nearly zero and the broader crypto market into a tailspin. 

The news comes a few days after Galaxy announced a share repurchase plan, which would buy back 10.6 million shares over the next 12 months. 

Galaxy is an early Terra backer, having invested in a January 2021 fundraise alongside Coinbase Ventures, Pantera Capital and Arrington Capital. Novogratz famously tweeted out his new tattoo of a wolf howling towards a moon with a banner with the word "Luna" adjacent to it. 

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