Galaxy Digital Holdings, the prominent digital asset investment firm led by veteran financier Mike Novogratz, is launching a $100 million hedge fund designed to capitalize on volatility in the cryptocurrency and fintech sectors, according to a report in the Financial Times.

The $100 million fund eyes backing from a mix of family offices, high-net-worth individuals, and institutional investors.

Galaxy, whose stock has recently exploded, is committing an undisclosed seed investment.

The new vehicle, slated for debut in the first quarter of 2026, will employ a market-neutral strategy by holding both long and short positions.

This approach will allow the fund to generate returns regardless of whether asset prices rise or fall. Galaxy’s plans come as the crypto market continues to face overall turbulence.

This hedge fund launch signals renewed institutional appetite for crypto-linked investments despite sector volatility.

By blending crypto exposure with fintech equities, Galaxy aims to hedge systemic risks while profiting from structural disruptions.

Tokenization of real-world assets and decentralized finance protocols is a big part of the growing opportunities.

According to FT, Galaxy plans to have 30% of the fund’s capital target for cryptocurrency tokens, including Bitcoin (BTC) and Solana (SOL). The remaining allocation will focus on equities in financial services companies.

Galaxy’s timing aligns with projections of explosive growth in crypto and fintech markets.

Currently, dips for Bitcoin and Ethereum, among other coins has seen the global crypto market decline to around $2.9 trillion.

However, analysts maintain a long-term bullish forecast, with the global cryptocurrency market expected to surpass $5 trillion in capitalization in the next couple of years.

Institutional adoption, clearer US regulations, and real-world applications in payments and remittances, among other factors, will be key catalysts. AI-blockchain synergies are also expected to boost the fintech market.

Galaxy’s plans come on the back of over $500 million in third-quarter 2025 profits, largely helped by strategic positioning in digital assets.

The firm manages over $17 billion in assets under management.

Recent infrastructure expansions further bolster its capabilities, with the company obtaining approval from Texas’s ERCOT grid operator to add 830 megawatts of power capacity at its Helios data center campus in West Texas.

Part of the institutional adoption has seen Galaxy close an initial issuance of its debut tokenized CLO at $75 million.

The transaction, anchored by an allocation of about $50 million from Grove Finance, targets bringing private credit onchain.

Novogratz recently lauded tokenization as a major development in the digital assets space.

“Let’s be clear, tokenizing equities and other real-world assets is an amazing tool to offer US brands, US excellence to the rest of the world,” he posted on X.

People from Indonesia, to Paraguay, to Benin will want to own Apple, and Google, and Spacex, and $GLXY!! Just like [dollar] stablecoins increase US reach, so will tokenized assets.

His comments came as NYSE announced the launch of a tokenization platform.

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