Novogratz Pushes SEC to Tokenize Galaxy Digital Shares—Because Paper Stock Certificates Are So 20th Century

Crypto billionaire Michael Novogratz is taking shareholder transparency to the blockchain—or at least trying to. His latest move? Petitioning the SEC to greenlight tokenized equity for his own company, Galaxy Digital.

Wall Street’s paperwork fetish meets its match

Forget dusty stock certificates and snail-paced settlements. Novogratz wants Galaxy’s shares traded as digital tokens—instant settlement, 24/7 markets, and all the efficiency crypto promises (when it’s not busy imploding). The SEC’s response? Probably a 300-page filing requirement.

Finance’s future or regulatory quicksand?

If approved, this could set a precedent for public companies flirting with blockchain—assuming the SEC doesn’t drown the idea in compliance questions first. Either way, Novogratz gets points for audacity: nothing says ’belief in crypto’ like betting your own stock on it.

Closing thought: Tokenizing shares won’t fix Galaxy’s earnings, but it’ll make the red ink flow faster on-chain.

The decision to tokenize shares arrives just as Galaxy Digital was expecting the launch of its GLXY shares on Nasdaq this Friday.

Michael Novogratz takes an experimental approach to tokenization

Galaxy Digital already manages over $7B in assets at the end of March, with $689M in its known crypto wallets. Novogratz aims to expand the usage of tokens, which can tap the value of shares and use it for DeFi collaterals, lending, or trading. Galaxy may end up tokenizing multiple assets, including other stocks or fixed-income instruments. 

There is still no standard of tokenization in crypto space, and attempts have ranged from ad-hoc tokenization to detailed plans to create new types of tokens to reflect stocks. Currently, the most useful applications for tokenization are for US Treasuries, applied as collateral in DeFi as well as for the creation of stablecoins. 

On-chain assets are currently estimated at $22.51B, with constant growth in the past months. Tokenized public equity is just a small fraction of that amount, at around $400M based on data from Rwa.xyz.

The approach of Novogratz is more experimental, including a tokenized Stradivarius violin from 1708. The tokenized assets are then used for collateralized crypto lending, usually limited to several leading protocols. Gold is also one of the main targets of tokenization, though with a relatively small market compared to traditional finance. 

Galaxy Digital is also a top 10 holder of Bitcoin in its corporate treasury. The company sits on a reserve of 12,830 BTC, down from 13,704 BTC in March. The company reported $295M in losses for Q1, based on diminishing asset prices and outlays due to decommissioning mining activities. 

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