Key Takeaways
- • Galaxy Digital and Sharplink announced a $125 million institutional DeFi yield fund, with $100 million from Sharplink's Ethereum treasury and $25 million from Galaxy, expected to launch in the coming weeks.
- • Sharplink holds approximately 868,700 ETH, making it the second-largest Ethereum treasury company, and the fund structure allows the firm to maintain ETH exposure while generating active yield through on-chain strategies.
- • Galaxy will serve as investment manager, leveraging its institutional research and risk management framework used across lending, trading, and asset management operations, with protocol selection and exposure sizing handled under this framework.
- • The fund targets decentralized finance liquidity protocols and blockchain-based yield-generating strategies, reflecting Galaxy's track record of deploying hundreds of millions in on-chain capital since 2020.
- • The partnership signals institutional capital's continued migration into decentralized finance, with mature infrastructure now enabling allocators to access yield and liquidity management comparable to traditional market standards.
Summary
Mike Novogratz's Galaxy Digital and ETH treasury company Sharplink announced a non-binding memorandum of understanding to establish the Galaxy Sharplink Onchain Yield Fund, a $125 million institutional private investment vehicle focused on decentralized finance liquidity protocols and on-chain yield-generating strategies. The fund is expected to launch within the coming weeks and will be managed by Galaxy, with total commitments comprising $100 million from Sharplink's staked Ethereum treasury and $25 million from Galaxy itself.
Sharplink, the second-largest Ethereum treasury company with approximately 868,700 ETH in holdings, structures the fund to maintain its core Ethereum exposure while simultaneously generating returns through actively managed on-chain strategies. This approach allows institutional capital to benefit from yield opportunities without liquidating underlying digital asset positions—a strategic consideration for large crypto-native balance sheet holders.
Galaxy will assume responsibility for protocol selection, exposure sizing, and ongoing portfolio monitoring under its institutional research and risk management framework. The same framework is currently deployed across Galaxy's lending, trading, and asset management operations. According to the announcement, Galaxy has deployed hundreds of millions of dollars into on-chain strategies since 2020 and is among the largest publicly traded firms actively allocating capital to decentralized finance and blockchain-based investment opportunities.
Novogratz emphasized the market shift in his statement: "Institutional capital is moving onchain, and the infrastructure to support it has matured to a point where allocators can access yield, liquidity, and risk management with the same rigor they expect in traditional markets." The partnership underscores a broader institutional pivot toward on-chain yield products, potentially expanding capital flows and adoption across decentralized finance ecosystems.
Sharplink, the second-largest Ethereum treasury company with approximately 868,700 ETH in holdings, structures the fund to maintain its core Ethereum exposure while simultaneously generating returns through actively managed on-chain strategies. This approach allows institutional capital to benefit from yield opportunities without liquidating underlying digital asset positions—a strategic consideration for large crypto-native balance sheet holders.
Galaxy will assume responsibility for protocol selection, exposure sizing, and ongoing portfolio monitoring under its institutional research and risk management framework. The same framework is currently deployed across Galaxy's lending, trading, and asset management operations. According to the announcement, Galaxy has deployed hundreds of millions of dollars into on-chain strategies since 2020 and is among the largest publicly traded firms actively allocating capital to decentralized finance and blockchain-based investment opportunities.
Novogratz emphasized the market shift in his statement: "Institutional capital is moving onchain, and the infrastructure to support it has matured to a point where allocators can access yield, liquidity, and risk management with the same rigor they expect in traditional markets." The partnership underscores a broader institutional pivot toward on-chain yield products, potentially expanding capital flows and adoption across decentralized finance ecosystems.
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