Galaxy Digital Sells $71.2 Million Worth of Block.one Shares for 123% Return

Galaxy Digital Holdings Ltd., a New York-based full-service crypto merchant bank that provides “distinct trading”, principal investment, and asset management services, has sold a significant amount of its outstanding shares in Block.one, a Cayman Islands-registered firm focused on publishing open-source software for EOS.

Founded by prominent crypto investor Michael Novogratz, Galaxy Digital has reportedly received $71.2 million after selling its shares in the company

123% Return On Investment (ROI)

According to a press release, published on May 21, 2019, Galaxy Digital’s management finalized the transaction involving the sale of its Block.one shares on Monday (May 20, 2019). This, after receiving (and accepting) a tender offer for its position in Block.one, which was reportedly made on April 18, 2019.

As noted in the announcement, the management at Galaxy Digital revealed it made a 123% return on its invested capital in Block.one. Per the release, the digital asset merchant bank’s remaining shares in Block.one “will no longer maintain a material position.”

“Rebalancing Portfolio To Maintain Appropriate Level Of Diversification”

Commenting on the sale of its shares in Block.one, Novogratz, the CEO at Galaxy Digital, remarked: 

The acceptance of Block.one’s tender offer reflected a decision to rebalance the portfolio to maintain an appropriate level of diversification after the position increased due to its substantial outperformance relative to the remainder of the portfolio.

The release mentioned that Galaxy Digital will maintain its partnership with Block.one - as the two firms are involved in various other businesses. Notably, Galaxy Digital operates an EOS-focused venture capital fund, which assists blockchain startups that are building decentralized applications (dApps) on the EOS platform.

In June 2018, Block.one and Galaxy Digital launched a $325 million joint initiative, called the EOSIO Ecosystem Fund. As its name implies, the EOS-focused fund will be used to provide funding to various projects that are supporting the ongoing development of EOSIO, one the largest smart contract-enabled, blockchain-based development platforms.

In July 2018, Block.one had reportedly received substantial investments from Peter Thiel, the co-founder of PayPal, and Jihan Wu, the co-founder of crypto mining giant Bitmain.

Galaxy Digital’s exit appears to have come as part of Block.one’s 10% buyback program from holders of its company shares. As confirmed by Bloomberg, Block.one’s buyback offer has been valued at approximately $2.3 billion, which represents an increase of almost 66x its original value (in 2017).

Block.one is Holding 140,000 Bitcoin

During Block.one’s seed funding round in 2017, the company’s shares had been offered at $22.5 (per share). The current repurchasing price for Block.one’s company shares is about $1,500 (per share).

Currently, Block.one has around $3 billion in total assets, which includes cash and investments (as of February 2019). This, according to an email sent to Block.one’s shareholders on March 19, 2019. The software developer is also holding approximately 140,000 Bitcoin (BTC), currently valued at $1.12 billion, in its treasury.

SBI Holdings Considering XRP Shareholder Benefit Program

Michael LaVere
  • Japanese financial services giant SBI Holdings is considering issuing XRP as a dividend to shareholders.
  • Morningstar, a subsidiary of SBI, began offering XRP to clients earlier in the year. 

Japanese financial services group SBI Holdings is considering paying shareholder dividends in XRP. 

Earlier in the year MorningStar Japan, a subsidiary of SBI, began offering shareholders the option of receiving dividends in XRP. Now the Tokyo-based parent company is considering doing the same in an effort to boost adoption for cryptocurrency. 

According to a report by CoinTelegraph Japan, SBI CEO Yoshitaka Kitao said the financial services group is open to the possibility of an XRP shareholder benefit program. Speaking at a meeting for shareholders on Dec. 2, Kitao said the program would begin during the fiscal year ending in March 2020, and would be an opt-in for clients willing to accept crypto dividends. 

Kitao revealed the number of applications for the SBI VC Trade digital currency exchange has increased following Morningstar’s decision to offer XRP benefits. 

SBI Holdings has a history of working with Ripple, the parent company behind XRP, including their joint venture SBI Ripple Asia in 2016 to promote the use of XRP. According to a financial report released in Oct. 2019, SBI highlighted the importance of Ripple’s technology for use in its remittance division. 

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