Novogratz’s Galaxy Assets Surge as Canadian Ether ETF Booms

(Bloomberg) -- Crypto billionaire Michael Novogratz’s Galaxy Digital Holdings Ltd. saw its biggest cash influx ever last month as Bitcoin and Ether marched to all-time highs. 

Galaxy controlled $3.2 billion at the end of October, a 45% jump from September, according to global asset management head Steve Kurz. The firm entered 2021 with less than $1 billion under management. 

One of the main drivers behind the jump was inflows into the firm’s Canadian ETF lineup -- particularly its Ether-focused fund. The CI Galaxy Ethereum ETF (ticker ETHX) has already amassed over $1 billion after launching in April, with its price doubling during that period. Kurz expects that flood of cash to build as Ether continues to enter the mainstream, similar to Bitcoin’s ascent.  

“Crypto’s becoming an asset class, not just an asset,” Kurz said in a phone interview. “From a market infrastructure and development of the asset class perspective, Ether is picking up steam, probably the way Bitcoin did a year-and-a-half ago.”

Ether has surged over 500% in 2021, fueled in part by the popularity of the Ethereum blockchain, which is the most-used network for applications such as decentralized finance and digital collectibles. Bitcoin -- the world’s largest cryptocurrency -- has rallied more than doubled this year. 

The first Bitcoin futures ETFs began trading last month, but a physical fund -- such as the Canadian Galaxy products -- have yet to be approved by U.S. regulators. Bloomberg Intelligence analysts forecast that U.S. investors are likely to see an Ethereum futures-based ETF launch before a fund that holds Bitcoin directly.

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