Digital currency-focused financial services provider Galaxy Digital Holdings agreed yesterday to purchase BitGo, a US-based cryptocurrency wallet developer backed by bitcoin mining technology producer BitFury, for about $1.2bn in cash and stock.
The deal will consist of $265m in cash and 38.8 million Galaxy Digital shares, which closed at $28.47 each yesterday. BitGo’s shareholders will own about 10% Galaxy Digital on a pro forma basis.
BitGo is a digital custodian for crypto assets, providing technology currently responsible for safeguarding some $40bn of assets. It has also added crypto asset-based products like trading, prime lending, portfolio management and tax services to its offering.
BitFury and the Galaxy Digital-backed Galaxy Digital Ventures participated in the company’s series B round, which closed at $57.5m in 2018.
Investment banking firm Goldman Sachs’ Principal Strategic Investments subsidiary and trading firm DRW also took part in the 2018 round, along with Valor Equity Partners, Craft Ventures and Redpoint Ventures.
Bridgescale Partners, Radar Partners, Founders Fund, Bitcoin Opportunity Corp, Liberty City Ventures, Crypto Currency Partners, A-Grade Investments and various individuals had supplied $12m for BitGo in June 2014 before BitFury subsidiary BitFury Capital added an undisclosed sum three months later.
Galaxy Digital founder and chief executive Mike Novogratz said: “The acquisition of BitGo establishes Galaxy Digital as a one-stop-shop for institutions and significantly accelerates our mission to institutionalise digital asset ecosystems and blockchain technology.
“The power of the technology, solutions and people we will have as a result of this acquisition will unlock unique value for our clients and drive long-term growth for our combined business.”
