Galaxy Announces Second Quarter 2024 Financial Results

Equity capital was $2.1 billion as of June 30, 2024

Net loss of $177 million for the second quarter, driven primarily by net losses on digital assets and investments as a result of a decline in digital asset markets

Net income of $245 million for the six months ended June 30, 2024, driven by strong operating performance and positive digital asset markets

Assets Under Stake of $3.3 billion as of July 18, 2024, up from $486 million at the end of March 2024

NEW YORK, Aug. 1, 2024 /CNW/ - Galaxy Digital Holdings Ltd. (TSX: GLXY) (the "Company" or "GDH Ltd.") today released financial results for the three months and six months ended June 30, 2024, for both itself and Galaxy Digital Holdings LP (the "Partnership" or "GDH LP"). In this press release, a reference to "Galaxy", "we", "our" and similar words refer to GDH Ltd., its subsidiaries and affiliates including GDH LP, or any one of them, as the context requires.

Corporate Updates

US Listing and Reorganization: Galaxy continues to work on completing its proposed reorganization and domestication to become a Delaware-incorporated company and subsequently list on the Nasdaq, upon completion of ongoing SEC review and subject to stock exchange, shareholder and applicable regulatory approvals of such transactions. On July 26, 2024, Galaxy filed an amendment to its registration statement responding to SEC comments, which is under review.

CryptoManufaktur Acquisition: On July 19, 2024, Galaxy announced that it acquired the assets of CryptoManufaktur ("CMF"), a blockchain node operator that provides trusted, secure services to decentralized protocols across the digital asset ecosystem. The addition of CMF brings approximately $1 billion in Ether assets under stake ("AUS"), raising the Company's total AUS to $3.3 billion as of July 18, 2024. As part of the transaction, CMF's seasoned three-person engineering team, led by founder Thorsten Behrens, joined Galaxy's Blockchain Infrastructure team, which provides staking and validator services to investors, protocols, and digital asset platforms.



     
     Select GDH LP Financial Metrics                     Q2 2024         Q1 2024 Q/Q % Change



     
     Equity Capital                                
         $2,129M   
         $2,192M        (3) %



     
     Liquidity                                     
         $1,328M   
         $1,499M       (11) %



     
     Cash & Net Stablecoins(1)                       
         $409M     
         $163M        150 %



     
     Net Digital Assets Excluding Stablecoins(2)     
         $501M     
         $821M       (39) %



     
     Spot Bitcoin ETFs                               
         $418M     
         $515M       (19) %



     
     Net Income (loss)                                   ($177M)     
         $422M      N.M.(3)



     
     Book Value Per Share in CAD4                
         $8.45 CAD 
         $9.11 CAD        (7) %



      Note:    Throughout this document, totals may not sum due to rounding. Quarter-over-quarter and year-over-year percentage change
                calculations are based on unrounded results.



     (1)   
     Includes Cash Equivalents.



     (2)   
     Refer to page 15 of this release for a breakout of our net digital assets position.



     (3)   
     Abbreviation for "Not Meaningful".



     (4)     Calculated as equity capital divided by outstanding Class A and Class B Units multiplied by the end of period foreign exchange rate.

Galaxy Global Markets

Galaxy Global Markets ("GGM") offers institutional-grade expertise and access to a broad range of digital asset products, including digital asset spot and derivatives trading, financing, capital markets and M&A advisory services to a diversified client base. GGM operates in two discrete business units - Trading and Investment Banking.

Trading

Trading reported counterparty trading revenue of $24 million in the second quarter. The decrease was primarily driven by lower trading volumes, which decreased by 19% quarter-over-quarter ("QoQ"), and unfavorable asset price movements. Despite the QoQ decrease, our counterparty trading business generated approximately $90 million in revenue year-to-date through June, a nearly 80% increase relative to the first half of 2023. Galaxy's average loan book size expanded to $699 million, driven by increased borrowing demand from both new and existing counterparties. Galaxy continues to onboard new counterparties, including large traditional institutions, and ended the second quarter with 1,212 total trading counterparties.



     
     Key Performance Indicators       Q2 2024    Q1 2024  Q/Q % Change



     
     Counterparty Trading Revenue   
        $24M  
        $66M        (64) %



     
     Loan Book Size (Average)      
        $699M 
        $664M           5 %



     
     Total Trading Counterparties       1,212       1,161            4 %



     
     Active Trading Counterparties        294         281            5 %

Investment Banking

Investment Banking successfully closed two deals in the second quarter, serving as the exclusive financial advisor to Toposware in its sale to Polygon and to another client on its strategic financing. In the quarter, Galaxy also served as the exclusive financial advisor to Bitstamp in its pending sale to Robinhood, which is expected to close in the first half of 2025 at which time Galaxy expects to recognize the revenue associated with this deal. Galaxy is executing against a pipeline of mandates representing $2.1 billion in potential deal value.



     
     Key Performance Indicators   Q2 2024   Q1 2024  Q/Q % Change



     
     Deals Closed                       2          1          100 %



     
     Pipeline                          19         20          (5) %



     
     Deal Value of Pipeline     
       $2.1B 
       $2.2B         (5) %

____

KEY TERMS

Counterparty Trading Revenue: revenue from counterparty-facing activities from our Derivatives, Credit, Over-the-Counter Trading, and Quantitative Trading businesses, net of associated funding charges.

Loan Book Size (Average): average market value of all open loans, un-funded arrangements to finance delayed trading/settlement (for example over weekends), and uncommitted credit facilities in the period.

Active Trading Counterparties: counterparties with whom we have traded within the past 12 months and who are still onboarded with Galaxy's trading business.

Pipeline: the number of open engagements and transactions the Investment Banking team has in market.

Deal Value of Pipeline: the theoretical aggregate deal value associated with the Investment Banking pipeline.

Galaxy Asset Management

Galaxy Asset Management ("GAM") provides investors access to the digital asset ecosystem via a diverse suite of institutional-grade investment vehicles that span passive, active, and venture strategies.

GAM reported assets under management ("AUM") of approximately $4.6 billion and management and performance fees of $14.5 million in the second quarter, down 42% and 19% QoQ respectively, primarily driven by the continued successful liquidation of assets associated with an ongoing opportunistic mandate to unwind portfolios on behalf of the FTX estate and market depreciation. In the quarter, GAM announced a collaboration with State Street Global Advisors to develop a suite of manager-directed digital asset ETFs that will offer investors exposure to companies in the digital asset space, going beyond crypto and bitcoin. Subsequent to quarter-end, GAM, in partnership with Invesco, announced the launch of the Invesco Galaxy Ethereum ETF (ticker: QETH). GAM conducted a $113 million initial close for Galaxy Ventures Fund I LP at the end of June, a venture capital fund focused on investing in early-stage companies across crypto protocols, software infrastructure, and financialized applications.



     
     Key Performance Indicators          Q2 2024    Q1 2024 Q/Q % Change



     
     Management and Performance Fees  
       $14.5M  
      $17.8M       (19) %



     
     Total AUM(1)                    
       $4,563M 
      $7,818M       (42) %



     
          Passive AUM                
       $2,392M 
      $2,730M       (12) %



     
          Active AUM(2)                
       $632M 
      $3,584M       (82) %



     
          Venture AUM                
       $1,539M 
      $1,504M          2 %




     (1) In Galaxy's monthly AUM disclosures, the "funds" line item consists of AUM held in GAM's Passive, Active, and Venture funds, excluding opportunistic assets. Total AUM for Q1 2024 was updated from what
            was previously reported as AUM for quarterly close vehicles are reported as of the most recent information available for the applicable period.



     (2) Includes opportunistic AUM. "Opportunistic" AUM are near-term or mid-term engagements to unwind portfolios managed by GAM. Opportunistic AUM was $520M as of June 30, 2024 and $3,440M as of March 31,
            2024.

____

KEY TERMS

Assets Under Management: all figures are unaudited. AUM is inclusive of sub-advised funds, committed capital closed-end vehicles, seed investments by affiliates, affiliated and unaffiliated separately managed accounts, engagements to unwind portfolios, and fund of fund products. Changes in AUM are generally the result of performance, contributions, withdrawals, liquidations and opportunistic mandate wins.

    --  AUM for committed capital closed-end vehicles that have completed their
        investment period is reported as NAV (Net Asset Value) plus unfunded
        commitment.
    --  AUM for quarterly close vehicles is reported as of the most recent
        quarter available for the applicable period.
    --  AUM for affiliated separately managed accounts is reported as NAV as of
        the most recently available estimate for the applicable period.

Passive Strategies: single- and multi-asset private funds, as well as a suite of regulated spot digital asset exchange-traded funds offered through partnerships with asset managers globally.

Active Strategies: Galaxy's Liquid Crypto Fund and the management of certain opportunistic mandates.

Venture Strategies: organized around two investment themes: Interactive Ventures and Crypto Ventures. Galaxy Interactive invests at the intersection of content, technology, and social commerce, managing client capital across three funds. GAM's Crypto Ventures sleeve includes Galaxy's inaugural crypto venture fund, which is focused on investing in early-stage companies across crypto protocols, software infrastructure, and financialized applications, as well as two global, multi-manager venture funds and a subset of Galaxy's balance sheet venture investments.

Galaxy Digital Infrastructure Solutions

Galaxy Digital Infrastructure Solutions ("GDIS") consists of proprietary and hosted bitcoin mining services, GK8 self-custody technology solutions, and blockchain infrastructure.

Mining

Mining revenue was $24.0 million for the second quarter, relative to power purchase costs and external hosting expenses, net of curtailment credits, of $10.5 million, resulting in a 56% direct mining profit margin. The QoQ decrease in revenue was primarily driven by the Bitcoin halving in April. Currently, Galaxy has 200 megawatts of energized mining capacity and is bringing on an additional 300 megawatts of high-voltage capacity in the third quarter of 2025. Galaxy has firm capacity approval from both the Electric Reliability Council of Texas and the Wind Energy Transmission of Texas to scale up to 800 megawatts of power from the existing interconnect. In the first quarter, we expanded our campus by purchasing an additional 160 acres adjacent to Helios. We now have a total of 320 acres of contiguous land and have submitted additional load studies and a new interconnection request that are pending approval.



     
     Key Performance Indicators            Q2 2024   Q1 2024  Q/Q % Change



     
     Mining Revenue                     
       $24.0M 
      $31.5M        (24) %



     
     Proprietary Mining Revenue         
       $16.3M 
      $20.1M        (19) %



     
     Hosted and Other Mining Revenue(1)  
       $7.7M 
      $11.4M        (32) %



     
     Total Hashrate Under Management       5.6 EH/   5.7 EH/
                                                    s         s         (3) %



     
     Proprietary Mining Hashrate           2.9 EH/   3.1 EH/
                                                    s         s         (5) %



     
     Hosted Mining Hashrate                2.6 EH/   2.6 EH/
                                                    s         s         (1) %



     
     Number of Proprietary BTC Mined           242        373         (35) %



     
     Average Marginal Cost to Mine         <$22.5K   <$19.5K          N.M.




     (1) Includes revenue from hosting clients and other mining
            related activities.

Blockchain Infrastructure and GK8

Blockchain Infrastructure and GK8 continue to build and invest in the technology that powers the digital assets ecosystem. Blockchain Infrastructure expanded its Assets Under Stake by 341% QoQ to $2.1 billion as of June 30th, with Galaxy growing to become one of the largest validators globally on the Solana network. As of July 18, 2024, AUS grew to $3.3 billion with the addition of approximately $1 billion in Ether AUS from the acquisition of CMF. GK8 continues to execute against its pipeline of enterprise clients.



     
     Key Performance Indicators   Q2 2024   Q1 2024  Q/Q % Change



     
     Assets Under Stake         
     $2,144M 
       $486M         341 %



     
     GK8 Total Client Count            22         21            5 %

_____

KEY TERMS

Hashrate Under Management: the total combined hashrate of active proprietary and hosted mining capacity managed by Galaxy.

Proprietary Mining Hashrate: the hashrate attributed to Galaxy owned and operated mining machines.

Hosted Mining Hashrate: the hashrate attributed to third-party machines operated by Galaxy for a client.

Number of Proprietary BTC Mined: the total amount of bitcoin mined from proprietary mining operations.

Average Marginal Cost to Mine: the average marginal cost of production for each bitcoin generated during the period. The calculation excludes depreciation, mark-to-market on power contracts, and corporate overhead.

Assets Under Stake: all figures are unaudited. AUS reflects the total notional value of assets bonded to Galaxy validators, based on prices as of the end of the specified period. This includes certain Galaxy balance sheet assets, Galaxy affiliate assets, and third party assets.

GK8 Total Client Count: the total number of clients contracted to use GK8's technology solutions.

Summary of Operating Expenses



     
     Operating expenses                       Q2 2024    Q1 2024 Q/Q % Change



     
     Compensation and compensation related 
         $43M 
         $42M          1 %



     
     Equity based compensation             
         $12M 
         $18M       (36) %



     
     General and administrative            
         $45M 
         $48M        (6) %



     
     Mining costs                          
         $10M 
         $15M       (31) %



     
     Trading and commission expense         
         $4M  
         $6M       (35) %



     
     Technology                             
         $7M  
         $6M         13 %



     
     Depreciation and amortization         
         $14M 
         $11M         18 %



     
     Impairment reversal                    
         $0M  
         $0M         N.M.



     
     Other                                  
         $9M  
         $8M         13 %



     
     Professional fees                     
         $14M 
         $13M          2 %



     
     Staking costs                         
         $32M  
         $1M         N.M.



     
     Interest                              
         $21M 
         $20M          5 %



     
     Notes interest expense                 
         $7M  
         $7M          1 %



     Note: Quarter-over-quarter percentage change calculations are based on
            unrounded results.

Overview of Second Quarter Operating Expenses:

    --  Compensation and compensation related expenses of $43 million were
        roughly flat QoQ.
    --  Equity based compensation decreased by approximately $6 million QoQ,
        primarily driven by fully vested high-priced equity grants issued in
        2021, partially offset by new grants issued in 2022, 2023 and 2024 at
        lower share prices.
    --  General and administrative expenses declined by approximately $3 million
        from the first quarter of 2024, driven by lower mining costs and trading
        and commission expenses, partially offset by higher depreciation and
        amortization costs.
        --  Mining costs decreased by approximately $5 million QoQ; reflecting
            our actively managed power strategy, leading to a reduction in
            electricity costs.
        --  Trading commission expenses decreased by approximately $2 million
            QoQ, on account of lower trading volumes in the quarter.
        --  Depreciation and amortization expenses increased by over $2 million
            QoQ, reflecting the additional depreciation from new mining machines
            and electrical infrastructure that were energized during the prior
            quarter.
    --  Professional fees of $14 million were slightly up QoQ.
    --  Staking costs was a new line item this quarter, and reflected the
        staking rewards that Galaxy generates from its AUS, which were paid to
        the delegators. This amount offsets the staking rewards received, which
        were included in the Lending and Staking revenue.
    --  Interest expense of $21 million was up approximately $1 million QoQ,
        reflecting our ability to source non-dilutive wholesale financing to
        help fund our Trading and Lending businesses and consistent with our
        risk management principles of sound Asset and Liability Management and
        maintaining substantial liquidity buffers.

GDH Ltd.'s Financial Highlights

As the only significant asset of GDH Ltd. is its minority interest in GDH LP, its results are driven by the results of GDH LP. GDH Ltd. accounts for its investment in this associate (GDH LP) using the equity method. The investment, initially recorded at cost, is increased or decreased to recognize GDH Ltd.'s share of the earnings and losses of GDH LP. The net comprehensive income (loss) of GDH Ltd. was $(49.4) million for the three months ended June 30, 2024 and $60.6 million for the six months ended June 30, 2024.

Earnings Conference Call

An investor conference call will be held today, August 1, 2024, at 8:30 AM Eastern Time. A live webcast with the ability to ask questions will be available at: https://investor.galaxy.com/. The conference call can also be accessed by investors in the United States or Canada by dialing 1-800-274-8461, or 1-203-518-9814 (outside the U.S. and Canada) using the Conference ID: GALAXY. A replay of the webcast will be available and can be accessed in the same manner as the live webcast on the Company's Investor Relations website. Through September 1, 2024, the recording will also be available by dialing 1-844-512-2921, or 1-412-317-6671 (outside the U.S. and Canada) and using the passcode: 11156334.

About Galaxy Digital Holdings Ltd. (TSX: GLXY) ("GDH Ltd.") and Galaxy Digital Holdings LP ("GDH LP")

Galaxy (TSX: GLXY) is a digital asset and blockchain leader providing access to the growing digital economy. We serve a diversified client base, including institutions, startups, and qualified individuals. Since 2018, Galaxy has been building a holistic financial platform spanning three complementary operating businesses: Global Markets, Asset Management, and Digital Infrastructure Solutions. Our offerings include, amongst others, trading, lending, strategic advisory services, institutional-grade investment solutions, proprietary bitcoin mining and hosting services, network validator services, and the development of enterprise self-custodial technology. The company is headquartered in New York City, with global offices across North America, Europe, and Asia. Additional information about Galaxy's businesses and products is available on www.galaxy.com.

This press release should be read in conjunction with (i) GDH LP's Management Discussion and Analysis and Consolidated Financial Statements for the three and six months ended June 30, 2024 and (ii) GDH Ltd.'s Management Discussion and Analysis and Consolidated Financial Statements for the three and six months ended June 30, 2024 (together, the "Consolidated Financial Statements" and "MD&As"), which have been filed on SEDAR at www.sedarplus.ca.

Disclaimers and Additional Information

The TSX has not approved or disapproved of the information contained herein. The Ontario Securities Commission has not passed upon the merits of the disclosure record of Galaxy.

This press release is not an offer to buy or sell, nor is it a solicitation of an offer to buy or sell, interests in the fund or any advisory services or any other security or to participate in any advisory services or trading strategy. If any offer and sale of securities is made, it will be pursuant to the confidential offering memorandum of the fund (the Offering Memorandum or fund prospectus ("Prospectus")). Any decision to make an investment in the fund should be made after reviewing such Offering Memorandum or Prospectus, conducting such investigations as the investor deems necessary and consulting the investor's own investment, legal, accounting and tax advisors in order to make an independent determination of the suitability and consequences of an investment.

No Offer or Solicitation

As previously announced, the Company intends to complete its proposed reorganization and domestication to become a Delaware-based company, and subsequently list on the Nasdaq, upon completion of the SEC's ongoing review and subject to stock exchange approval of such listing. The proposed reorganization and domestication is subject to approval by shareholders the Company and applicable regulatory authorities, including the Toronto Stock Exchange. In connection with the proposed reorganization and domestication, the Company has filed a registration statement, including a management information circular/prospectus, with the SEC, which has not yet become effective. SHAREHOLDERS ARE ADVISED TO READ THE FINAL VERSIONS OF SUCH DOCUMENTS, WHEN AVAILABLE, BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION. Shareholders may obtain a free copy of the registration statement (including the management information circular/prospectus) and any other relevant documents from the SEC's website at http://www.sec.gov. Copies of the final versions of such documents can also be obtained, when available, without charge, via Galaxy's investor relations website: https://investor.galaxy.com/ The Company anticipates holding a shareholder meeting to seek approval following the effectiveness of the registration statement, and further details will be included in the management information circular to be mailed to shareholders and posted on the Company's SEDAR profile at www.sedarplus.ca.

This document shall not constitute a solicitation of a proxy, consent or authorization with respect to any securities or in respect of the domestication or any of the other proposed reorganization transactions. This document does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote of approval, nor shall there be any sale of securities in any jurisdiction in which such offer, solicitation or sale would be unlawful prior to the registration or qualification under the securities laws of any such jurisdiction.

CAUTION ABOUT FORWARD-LOOKING STATEMENTS

The information in this document may contain "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended (the "Securities Act"), Section 21E of the Securities Exchange Act of 1934, as amended and "forward-looking information" under Canadian securities laws (collectively, "forward-looking statements"). Our forward-looking statements include, but are not limited to, statements regarding our or our management team's expectations, hopes, beliefs, intentions or strategies regarding the future. Statements that are not historical facts, including statements about Galaxy's business pipelines for banking and Gk8, mining goals, focus on self custody and validator solutions and our commitment to the future of decentralized networks and the pending domestication and the related transactions (the "transactions"), and the parties, perspectives and expectations, are forward-looking statements. In addition, any statements that refer to estimates, projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. The words "anticipate," "believe," "continue," "could," "estimate," "expect," "forecast," "intend," "may," "might," "plan," "possible," "potential," "predict," "project," "should," "would" and similar expressions may identify forward-looking statements, but the absence of these words does not mean that a statement is not forward-looking. The forward-looking statements contained in this document are based on our current expectations and beliefs concerning future developments and their potential effects on us taking into account information currently available to us. There can be no assurance that future developments affecting us will be those that we have anticipated. These forward-looking statements involve a number of risks, uncertainties (some of which are beyond our control) or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. These risks include, but are not limited to: (1) the inability to complete the proposed domestication and reorganization transactions, due to the failure to obtain shareholder and stock exchange approvals, or otherwise; (2) changes to the proposed structure of the transactions that may be required or appropriate as a result of applicable laws or regulations or as a condition to obtaining shareholder or stock exchange approval of the transactions; (3) the ability to meet and maintain listing standards following the consummation of the transactions; (4) the risk that the transactions disrupt current plans and operations; (5) costs related to the transactions, operations and strategy; (6) changes in applicable laws or regulations; (7) the possibility that the Company may be adversely affected by other economic, business, and/or competitive factors; (8) changes or events that impact the cryptocurrency industry, including potential regulation, that are out of our control; (9) the risk that our business will not grow in line with our expectations or continue on its current trajectory; (10) the possibility that our addressable market is smaller than we have anticipated and/or that we may not gain share of it; and (11) the possibility that there is a disruption in mining impacting our ability to achieve expected results or change in power dynamics impacting our results, (12) any delay or failure to consummate the business mandates or achieve its pipeline goals in banking and Gk8, (13) liquidity or economic conditions impacting our business (14) regulatory concerns, technological challenges, cyber incidents or exploits on decentralized networks (15) those other risks contained in the Annual Information Form for the year ended December 31, 2023 available on the Company's profile at www.sedarplus.ca and its Management's Discussion and Analysis, filed on August 1, 2024. Factors that could cause actual results to differ materially from those described in such forward-looking statements include, but are not limited to, a decline in the digital asset market or general economic conditions; the possibility that our addressable market is smaller than we have anticipated and/or that we may not gain share of the stated addressable market; the failure or delay in the adoption of digital assets and the blockchain ecosystem; a delay or failure in developing infrastructure for our business or our businesses achieving our banking and Gk8 mandates; delays or other challenges in the mining business related to hosting, power or our mining infrastructure; any challenges faced with respect to decentralized networks, considerations with respect to liquidity and capital planning and changes in applicable law or regulation and adverse regulatory developments. Should one or more of these risks or uncertainties materialize, they could cause our actual results to differ materially from the forward-looking statements. We are not undertaking any obligation to update or revise any forward looking statements whether as a result of new information, future events or otherwise. You should not take any statement regarding past trends or activities as a representation that the trends or activities will continue in the future. Accordingly, you should not put undue reliance on these statements.

©Copyright Galaxy Digital 2024. All rights reserved.

Galaxy Digital Holdings LP's Consolidated Statements of Financial Position (unaudited)



     (in thousands)                                                                                      June 30, 2024 December 31, 2023



     
                Assets



     
                Current assets



     Cash and cash equivalent                                                                                 $314,033           $316,610



     Digital assets                                                                                          1,954,398          1,078,587



     Receivable for digital asset trades                                                                        26,907             41,339



     Digital assets loans receivable, net of allowance                                                         177,230            104,504



     Digital assets receivables                                                                                 44,576             14,686



     Investments (includes $45.1 million and $0 of equity method investments, respectively)                    508,380



     Assets posted as collateral                                                                               203,942            318,195



     Receivables                                                                                                25,840             15,983



     Derivative assets                                                                                         153,470            173,209



     Prepaid expenses and other assets                                                                          27,780             37,910



     Loans receivable, net of allowance                                                                        404,991            377,105



     Due from related party                                                                                     31,891              5,007



     Total current assets                                                                                    3,873,438          2,483,135





     Digital assets receivables                                                                                  3,854              6,174



     Investments (includes $394.8 million and $290.4 million of equity method investments, respectively)       800,315            735,103



     Restricted digital assets                                                                                  15,863             41,356



     Digital asset loans receivable, non-current                                                                12,881



     Loans receivable, non-current                                                                                                10,259



     Property and equipment                                                                                    267,431            259,965



     Other non-current assets                                                                                  107,284             95,000



     Goodwill                                                                                                   44,257             44,257



     Total non-current assets                                                                                1,251,885          1,192,114



     
                Total assets                                                                              $5,125,323         $3,675,249





     
                Liabilities and equity



     
                Current liabilities



     Investments sold short                                                                                    115,240             25,295



     Derivative liabilities                                                                                    118,770            160,642



     Accounts payable and accrued liabilities                                                                   73,118             69,212



     Payable to customers                                                                                       94,816              3,503



     Taxes payable                                                                                              12,636             25,936



     Payable for digital asset trades                                                                           34,751              4,176



     Digital assets loans payable                                                                              950,178            398,277



     Loans payable                                                                                             211,384             93,069



     Collateral payable                                                                                        811,656            581,362



     Due to related party                                                                                       87,403             67,953



     Lease liability                                                                                             3,960              3,860



     Total current liabilities                                                                               2,513,912          1,433,285





     Notes payable                                                                                             427,679            408,053



     Deferred tax liability                                                                                     46,734             33,894



     Lease liability                                                                                             8,271             10,236



     Total non-current liabilities                                                                             482,684            452,183



     
                Total liabilities                                                                          2,996,596          1,885,468





     
                Equity



     Partners' capital                                                                                       2,128,727          1,789,781



     
                Total equity                                                                               2,128,727          1,789,781





     
                Total liabilities and equity                                                              $5,125,323         $3,675,249

Galaxy Digital Holdings LP's Consolidated Statements of Income (Loss) and Comprehensive Income (Loss) (unaudited)



     
                (in thousands)                                    Three months ended                                Six months ended


                                                       June 30, 2024                    June 30, 2023  June 30, 2024                    June 30, 2023



     
                Income



     Fee revenue                                            $26,483                           $11,097         $54,611                           $25,526



     Net realized gain (loss) on digital assets           (161,738)                           20,179         108,660                            86,298



     Net realized gain (loss) on investments                 12,826                            48,334       (160,008)                           46,356



     Lending and staking revenue                             54,371                            10,809          84,309                            21,318



     Net derivative gain                                    105,322                             9,641         188,962                            64,725



     Revenue from proprietary mining                         16,312                             8,563          36,440                            10,980



     Other income                                               140                                43             475                               206


                                                              53,716                           108,666         313,449                           255,409





     
                Operating expenses



     Compensation and compensation related                   42,921                            34,632          85,397                            65,252



     Equity based compensation                               11,601                            15,655          29,590                            38,925



     General and administrative                              44,721                            14,742          92,777                            29,647



     Mining costs                                            10,452                             (130)         25,638                             5,830



     Trading and commission expense                           4,112                             2,341          10,434                             3,285



     Technology                                               7,356                             4,599          13,852                             8,994



     Depreciation and amortization                           13,505                             7,318          24,932                            11,765



     Impairment reversal                                                                     (5,932)                                        (11,914)



     Other                                                    9,296                             6,546          17,921                            11,687



     Professional fees                                       13,704                             8,785          27,077                            18,603



     Staking costs                                           32,034                               308          32,696                               539



     Interest                                                20,927                             4,334          40,775                             9,873



     Notes interest expense                                   7,040                             6,790          14,016                            13,521


                                                           (172,948)                         (85,246)      (322,328)                        (176,360)





     
                Other



     Net unrealized gain (loss) on digital assets            42,900                           (4,774)        139,713                           (1,745)



     Net unrealized gain (loss) on investments            (114,314)                         (65,850)        121,538                            16,863



     Net loss on notes payable - derivative                 (2,573)                            (799)       (12,286)                          (2,104)



     Foreign currency gain (loss)                             1,474                                63           1,353                              (75)


                                                            (72,513)                         (71,360)        250,318                            12,939





     
                Income before income taxes              (191,745)                         (47,940)        241,439                            91,988



     Income taxes expense (benefit)                        (14,736)                          (1,900)        (3,216)                            3,826



     
                Net income for the period              $(177,009)                        $(46,040)       $244,655                           $88,162





     
                Other comprehensive income



     Foreign currency translation adjustment                  1,724                               $39           1,089                             (416)





     
                Comprehensive income for the period    $(175,285)                        $(46,001)       $245,744                           $87,746


                                                               Three months ended                                Six months ended


                                                 June 30, 2024                    June 30, 2023  June 30, 2024                    June 30, 2023



     
           GDH LP Net income (loss) per unit:



     Basic                                            $(0.52)                          $(0.14)          $0.74                             $0.28



     Diluted                                           (0.52)                           (0.14)           0.70                              0.27



     
           Weighted average units:



     Basic                                        338,212,221                       321,392,562     331,685,773                       320,391,466



     Diluted                                      338,212,221                       321,392,562     350,414,148                       327,417,371

Reportable segments (unaudited)

Income and expenses by each reportable segment of GDH LP for the three months ended June 30, 2024 are as follows:



     
                (in thousands)                                               Global                  Asset                  Digital       Corporate         Totals
                                                                      Markets             Management            Infrastructure
                                                                                                                   Solutions                  and Other



     
                Income (loss)



     Fee revenue(1)



     Mining hosting fees                                         
     $                 - 
     $                  -                  $7,775   
     $           -        $7,775



     Licensing fees                                                                                                               612             (120)           492



     Management and performance fees                                             3,694                  14,535                                     (734)        17,495



     Advisory fees                                                                 721                                                                            721



     Total fee revenue                                                           4,415                  14,535                    8,387             (854)        26,483



     Lending and staking revenue



     Lending income                                                             16,012                                                                8         16,020



     Blockchain rewards                                                            578                   3,808                   37,497           (3,532)        38,351



     Total lending and staking revenue                                          16,590                   3,808                   37,497           (3,524)        54,371





     Net realized gain on digital assets                                     (178,808)                 16,274                      796                       (161,738)



     Net realized gain (loss) on investments                                    10,206                   2,620                                                  12,826



     Net derivative gain                                                       105,550                                           (228)                        105,322



     Revenue from proprietary mining                                                                                           16,312                          16,312



     Other income                                                                  (4)                     33                      111                             140



     
                Total revenues and gain (loss) from operations              (42,051)                 37,270                   62,875           (4,378)        53,716





     
                Operating expenses                                            68,604                  13,781                   69,230            21,333        172,948





     Net unrealized gain on digital assets                                     136,323                (86,685)                 (6,738)                         42,900



     Net unrealized gain (loss) on investments                                (81,230)               (34,369)                   1,285                       (114,314)



     Net loss on notes payable - derivative                                                                                                    (2,573)       (2,573)



     Foreign currency loss                                                       1,474                                                                          1,474


                                                                                 56,567               (121,054)                 (5,453)          (2,573)      (72,513)





     
                Income (loss) before income taxes                          $(54,088)              $(97,565)               $(11,808)        $(28,284)    $(191,745)



     Income tax expense                                                                                                                       (14,736)      (14,736)



     
                Net income (loss)                                          $(54,088)              $(97,565)               $(11,808)        $(13,548)    $(177,009)



     Foreign currency translation adjustment                                                                                                     1,724          1,724



     
                Comprehensive income (loss)                                $(54,088)              $(97,565)               $(11,808)        $(11,824)    $(175,285)




     
     (1) Asset Management fee revenue includes management fees generated off the Partnership's balance sheet venture investments. Licensing fees are attributable to GK8, and include license fees paid by the
              Partnership for the use of GK8's technology. All intercompany transactions are eliminated in the Corporate & Other segment.

Income and expenses by each reportable segment of GDH LP for the six months ended June 30, 2024 are as follows:



     
                (in thousands)                                  Global                Asset                  Digital        Corporate        Totals
                                                         Markets             Management          Infrastructure
                                                                                                    Solutions                 and Other(1)



     
                Income (loss)



     Fee revenue (1)



     Mining hosting fees                            
     $                 - 
     $                -                 $17,916   
     $             -      17,916



     Licensing fees                                                     1                                         1,419               (240)       1,180



     Management and performance fees                                3,694                32,372                                     (1,481)      34,585



     Advisory fees                                                    930                                                                          930



     Total fee revenue                                              4,625                32,372                   19,335             (1,721)      54,611



     Lending and staking revenue



     Lending income                                                32,756                     5                        2                  12       32,775



     Blockchain rewards                                             5,660                11,046                   43,575             (8,747)      51,534



     Total lending and staking revenue                             38,416                11,051                   43,577             (8,735)      84,309





     Net realized gain on digital assets                           91,497                16,367                      796                         108,660



     Net realized gain (loss) on investments                    (173,323)               13,315                                               (160,008)



     Net derivative gain                                          188,095                                           867                         188,962



     Revenue from proprietary mining                                                                            36,440                          36,440



     Other income                                                     153                    33                      289                             475


                                                                   149,463                73,138                  101,304            (10,456)     313,449





     
                Operating expenses                              133,033                29,585                  110,110              49,600      322,328





     Net unrealized gain on digital assets                        184,582              (41,358)                 (3,511)                        139,713



     Net unrealized gain (loss) on investments                     98,480                23,108                     (50)                        121,538



     Net loss on notes payable - derivative                                                                                      (12,286)    (12,286)



     Foreign currency loss                                          1,353                                                                        1,353


                                                                   284,415              (18,250)                 (3,561)           (12,286)     250,318





     
                Income (loss) before income taxes              $300,845               $25,303                $(12,367)          $(72,342)    $241,439



     Income tax expense                                                                                                           (3,216)     (3,216)



     
                Net income (loss)                              $300,845               $25,303                $(12,367)          $(69,126)    $244,655



     Foreign currency translation adjustment                                                                                        1,089        1,089



     
                Comprehensive income (loss)                    $300,845               $25,303                $(12,367)          $(68,037)    $245,744




     
     (1) Asset Management fee revenue includes management fees generated off the Partnership's balance sheet venture investments. Licensing fees are attributable to GK8, and include license fees paid by the
              Partnership for the use of GK8's technology. All intercompany transactions are eliminated in the Corporate & Other segment.

Income and expenses by each reportable segment of GDH LP for the three months ended June 30, 2023 are as follows:



     
                (in thousands)                                           Global               Asset                 Digital   Corporate       Totals
                                                                  Markets          Management           Infrastructure
                                                                                                           Solutions              and Other



     
                Income (loss)



     Fee revenue (1)



     Mining hosting fees                                                                                                6,548                    $6,548



     Licensing fees                                                                                                       610                       610



     Management and performance fees                                                            4,216                                 (762)       3,454



     Advisory fees                                                             57                                                                    57



     Other fee revenues                                                                                                   428                       428



     Total fee revenue                                                         57                4,216                    7,586         (762)      11,097



     Lending and staking revenue



     Lending income                                                         9,990                    9                                             9,999



     Blockchain rewards                                                     (706)               1,516                                               810



     Total lending and staking revenue                                      9,284                1,525                                            10,809





     Net realized gain on digital assets                                   17,601                2,578                                            20,179



     Net realized gain (loss) on investments                               23,725               24,609                                            48,334



     Net derivative gain                                                    8,769                1,008                    (136)                    9,641



     Revenue from proprietary mining                                                                                    8,563                     8,563



     Other income (expense)                                                    96                 (96)                      11            32           43



     
                Total revenues and gain (loss) from operations           59,532               33,840                   16,024         (730)     108,666





     
                Operating expenses                                       40,894               13,790                    7,748        22,814       85,246





     Net unrealized gain (loss) on digital assets                         (1,067)             (3,707)                                          (4,774)



     Net unrealized gain on investments                                  (23,726)            (45,532)                   3,408                  (65,850)



     Net loss on notes payable - derivative                                                                                          (799)       (799)



     Foreign currency loss                                                     63                                                                    63


                                                                          (24,730)            (49,239)                   3,408         (799)    (71,360)





     
                Income (loss) before income taxes                      $(6,092)           $(29,189)                 $11,684     $(24,343)   $(47,940)



     Income tax expense                                                                                                            (1,900)     (1,900)



     
                Net income (loss)                                      $(6,092)           $(29,189)                 $11,684     $(22,443)   $(46,040)



     Foreign currency translation adjustment                                                                                            39           39



     
                Comprehensive income (loss)                            $(6,092)           $(29,189)                 $11,684     $(22,404)   $(46,001)




     
     (1) Asset Management fee revenue includes management fees generated off the Partnership's balance sheet venture investments, which are eliminated in
              the Corporate & Other segment.

Income and expenses by each reportable segment of GDH LP for the six months ended June 30, 2023 are as follows:



     
                (in thousands)                                             Global               Asset                   Digital       Corporate      Totals
                                                                    Markets             Management          Infrastructure
                                                                                                               Solutions                  and Other



     
                Income (loss)



     Fee revenue (1)



     Mining hosting fees                                         
     $              - 
     $                 -                 $12,816   
     $           -    $12,816



     Licensing fees                                                                                                           790                          790



     Management and performance fees                                                                9,148                                   (1,382)      7,766



     Advisory fees                                                            2,265                                                                      2,265



     Other fee revenues                                                        (54)                                         1,943                        1,889



     Total fee revenue                                                        2,211                  9,148                   15,549           (1,382)     25,526



     Lending and staking revenue



     Lending income                                                          19,078                     17                                               19,095



     Blockchain rewards                                                         707                  1,516                                                2,223



     Total lending and staking revenue                                       19,785                  1,533                                               21,318





     Net realized gain on digital assets                                     82,633                  3,665                                               86,298



     Net realized gain (loss) on investments                                 24,099                 22,257                                               46,356



     Net derivative gain                                                     63,319                  1,542                    (136)                      64,725



     Revenue from proprietary mining                                                                                       10,980                       10,980



     Other income (expense)                                                     134                  (163)                      55               180         206



     
                Total revenues and gain (loss) from operations            192,181                 37,982                   26,448           (1,202)    255,409





     
                Operating expenses                                         83,103                 29,978                   17,062            46,217     176,360





     Net unrealized gain (loss) on digital assets                           (1,744)                   (1)                                             (1,745)



     Net unrealized gain on investments                                      16,647                (6,435)                   6,651                       16,863



     Net loss on notes payable - derivative                                                                                                (2,104)    (2,104)



     Foreign currency loss                                                     (75)                                                                      (75)


                                                                              14,828                (6,436)                   6,651           (2,104)     12,939





     
                Income (loss) before income taxes                        $123,906                 $1,568                  $16,037         $(49,523)    $91,988



     Income tax expense                                                                                                                      3,826       3,826



     
                Net income (loss)                                        $123,906                 $1,568                  $16,037         $(53,349)    $88,162



     Foreign currency translation adjustment                                                                                                 (416)      (416)



     
                Comprehensive income (loss)                              $123,906                 $1,568                  $16,037         $(53,765)    $87,746




     
     (1) Asset Management fee revenue includes management fees generated off the Partnership's balance sheet venture investments, which are eliminated in
              the Corporate & Other segment.

Assets and liabilities by reportable segment of GDH LP as of June 30, 2024 are as follows:


     (in thousands)                Global              Asset                 Digital             Corporate    Totals
                       Markets            Management          Infrastructure           and Other
                                                                 Solutions


     Total assets              $3,972,284            $643,731                 $351,145               $158,163 $5,125,323




     Total liabilities         $2,356,282              $1,250                  $10,055               $629,009 $2,996,596

Assets and liabilities by reportable segment of GDH LP as of December 31, 2023 are as follows:


     (in thousands)                Global              Asset                 Digital             Corporate    Totals
                       Markets            Management          Infrastructure           and Other
                                                                Solutions


     Total assets              $2,726,950            $575,056                 $321,322                $51,921 $3,675,249




     Total liabilities         $1,289,792             $10,968                   $9,817               $574,891 $1,885,468

Select statement of financial position information

Select assets by reporting segment of GDH LP as of June 30, 2024 is as follows:



     
                (in thousands)             Global              Asset                   Digital                Corporate      Totals
                                  Markets            Management            Infrastructure              and Other
                                                                              Solutions



     Digital assets                      $1,925,574             $44,687 
        $                    - 
        $                -  $1,970,261



     Digital assets receivables              12,241              35,253                         936                               48,430



     Assets posted as collateral            203,942                                                                            203,942



     Loans receivable                       595,102                                                                            595,102



     Investments                            764,285             532,084                      12,326                            1,308,695



     Property and equipment                                                               260,258                    7,173      267,431


                                          $3,501,144            $612,024                    $273,520                   $7,173   $4,393,861

Select assets by reporting segment of GDH LP as of December 31, 2023 is as follows:



     
                (in thousands)             Global              Asset                   Digital                Corporate      Totals
                                  Markets            Management            Infrastructure              and Other
                                                                              Solutions



     Digital assets                      $1,052,013             $67,930 
        $                    - 
        $                -  $1,119,943



     Digital assets receivables               6,506              13,135                       1,219                               20,860



     Assets posted as collateral            318,195                                                                            318,195



     Loans receivable                       491,868                                                                            491,868



     Investments                            244,807             476,262                      14,034                              735,103



     Property and equipment                     109                                        252,552                    7,304      259,965


                                          $2,113,498            $557,327                    $267,805                   $7,304   $2,945,934

Net Digital Assets Position

Net digital assets includes all digital assets categorized as assets, less all digital assets categorized as liabilities on the statement of financial position and is included in the Company's liquidity measure. Net digital assets as of June 30, 2024 and December 31, 2023 is as follows:



     
                
                  (in thousands)                                 BTC (3)       ETH (4)        Stablecoin       Other (5)         As of

                                                                                                                                             June 30, 2024



     
                Assets



     Digital assets                                                            $1,202,920     $344,110           $236,122          $171,246        $1,954,398



     Digital asset loans receivable, net of allowance                              16,656       28,612            118,733            26,110           190,111



     Digital assets receivable, current                                                                                           44,576            44,576



     Digital assets receivable, non-current                                                                                        3,854             3,854



     Assets posted as collateral - Digital assets(1)                              163,950       28,594                               1,429           193,973



     Restricted digital assets, non-current(2)                                                                                    15,863            15,863


                                                                                 1,383,526      401,316            354,855           263,078         2,402,775



     
                Liabilities



     Digital asset loans payable                                                  620,602       57,089            242,529            29,958           950,178



     Collateral payable(1)                                                        584,957      145,166             17,807            14,621           762,551



     Payables to customers                                                         94,586                                                           94,586


                                                                                 1,300,145      202,255            260,336            44,579         1,807,315



     
                Digital assets, net                                             $83,381     $199,061            $94,519          $218,499           595,460



     Stablecoins, net                                                      
     $          - 
     $       -           $94,519   
     $           -           94,519



     
                Digital assets, net excl. stablecoins                           $83,381     $199,061 
     
     $            -         $218,499          $500,941





     
                
                  Bitcoin spot ETFs included in Investments        418,068                                                          418,068




     
     (1) 
     Excludes cash portion of balance on the Partnership's statement of financial position.



     
     (2) 
     Represents TIA and SOL tokens that are subject to a sale restriction of greater than one year.



     
     (3)   Includes associated tokens such as wBTC. The Partnership also held interests in investment vehicles designed to hold BTC, including Galaxy sponsored BTC funds and Mt. Gox Investment Fund LP, valued at
                $129.1 million as of June 30, 2024 reflected in the investments balance in addition to the digital assets noted above. The Partnership also held bitcoin derivative positions not reflected above in
                addition to the noted bitcoin investment vehicles.



     
     (4)   Includes associated tokens such as wETH and stETH. The Partnership also held interests in investment vehicles designed to hold ETH, including Galaxy sponsored ETH funds, valued at $42.3 million as of
                June 30, 2024 reflected in the investments balance in addition to the digital assets noted above. The Partnership also held Ether derivative positions not reflected above in addition to the noted Ether
                investment vehicles.



     
     (5)   Includes $43.6 million net SOL and $45.3 million net TIA. The Partnership also held an interest in investment vehicles designed to hold SOL, the Galaxy sponsored Galaxy Digital Crypto Vol Fund LLC valued
                at $91.4 million as of June 30, 2024 reflected in the investments balance in addition to the digital assets noted above, and the Partnership held digital asset derivative positions not reflected above
                in addition to the noted investment vehicle.


     (in thousands)                                                            BTC (4)       ETH (5)          Stablecoin       Other (5)         As of December
                                                                                                                                                        31, 2023



     
                Assets



     Digital assets                                                             $589,011     $174,978             $179,222          $135,376             $1,078,587



     Digital asset loans receivable, net of allowance                              3,044       87,252               12,000             2,208                104,504



     Digital assets receivable, current                                                                                            14,686                 14,686



     Digital assets receivable, non-current                                                                                         6,174                  6,174



     Assets posted as collateral - Digital assets(1)                             197,092      119,012                                                     316,104



     Restricted digital assets, non-current(2)                                                                                     41,356                 41,356


                                                                                  789,147      381,242              191,222           199,800              1,561,411



     
                Liabilities



     Digital asset loans payable                                                  48,202       14,603              297,762            37,710                398,277



     Collateral payable(1)                                                       437,889      116,723                9,457             5,926                569,995


                                                                                  486,091      131,326              307,219            43,636                968,272



     
                Digital assets, net                                           $303,056     $249,916           $(115,997)         $156,164                593,139



     Stablecoins, net(3)                                                   
     $         - 
     $       -          $(115,997)   
     $          -             (115,997)



     
                Digital assets, net excl. stablecoins                         $303,056     $249,916 
     
       $            -         $156,164               $709,136





     
                
                  Bitcoin spot ETFs included in Investments 
     $         - 
     $       -    
     $            -   
     $          -    
     $              -




     
     (1) 
     Excludes cash portion of balance on the Partnership's statement of financial position.



     
     (2) 
     Represents TIA tokens that are subject to a sale restriction of greater than one year.



     
     (3) 
     As of December 31, 2023, stablecoin liabilities were greater than stablecoin assets.



     
     (4)   Includes associated tokens such as wBTC. The Partnership also held interests in investment vehicles designed to hold BTC, including ProShares Bitcoin Strategy ETF, Galaxy sponsored BTC funds, and Mt. Gox
                Investment Fund LP, valued at $123.1 as of December 31, 2023 reflected in the investments balance in addition to the digital assets noted above. The Partnership also held bitcoin derivative positions
                not reflected above in addition to the noted bitcoin investment vehicles.



     
     (5)   Includes associated tokens such as wETH and stETH. The Partnership also held interests in investment vehicles designed to hold ETH, including Galaxy sponsored ETH funds, valued at $22.1 million as of
                December 31, 2023 reflected in the investments balance in addition to the digital assets noted above. The Partnership also held Ethereum derivative positions not reflected above in addition to the noted
                Ethereum investment vehicles.



     
     (6) 
     Includes $12.0 million net SOL and $68.5 million net TIA. The Partnership also held digital asset derivative positions not reflected above.

All figures are in U.S. Dollars unless otherwise noted.

SOURCE Galaxy Digital Holdings Ltd.