Mike Novogratz's crypto merchant bank, Galaxy Digital, is reportedly raising at least $250M for a fund aimed at helping floundering crypto firms, Business Insider reports.
Galaxy, which runs a business that spans trading and asset management, is preparing to launch a credit fund to provide loans to crypto-native firms struggling amidst the bear market. The fund is part of the firm's asset management unit. A number of crypto companies raised money via so-called initial coin offerings, an ether-based way to raise funds by issuing a token. As the price of ether has tanked, so too have the treasuries of many crypto-native firms.
To get a loan, firms will have to provide Galaxy with collateral that could include crypto, property, and mining rigs, the report said.
As the bear market in crypto leads to job cuts at many firms in the nascent ecosystem, lending businesses continue to expand, according to a report by Bloomberg earlier this month.
BlockFi, a Galaxy-backed firm, grew its revenues and customer-base 10-fold since June, the report said. Salt Lending, another crypto lender, is "hiring more every month as its revenue ticks higher."