Key Takeaways
- • Galaxy Digital Holdings will pay $200 million in penalties to the New York Attorney General to resolve civil claims related to its investment, trading, and public statements regarding Luna cryptocurrency between late 2020 and 2022.
- • The penalty is payable in installments through 2028; Galaxy has already accrued a legal provision of $166 million to cover the settlement obligation.
- • The settlement addresses allegations that Galaxy failed to disclose the sale of over 1.3 million Luna tokens at prices ranging from $69.15 to $84.80 between January 5-13, 2022, potentially constituting undisclosed market activity during the token's decline.
- • The enforcement action represents a significant regulatory victory for New York authorities in their ongoing oversight of cryptocurrency firms and represents one of the largest crypto-related penalties assessed by a state regulator.
Summary
Michael Novogratz's Galaxy Digital Holdings reached a $200 million settlement with the New York Attorney General on March 27, 2025, resolving civil claims stemming from the firm's role in promoting and trading the failed Luna cryptocurrency. The settlement addresses Galaxy's investment activities, trading practices, and public statements made between late 2020 and 2022, a period encompassing Luna's explosive growth and subsequent collapse.
A core allegation centers on Galaxy's failure to publicly disclose significant token sales. Between January 5 and January 13, 2022, Galaxy sold over 1.3 million Luna tokens at prices ranging from $69.15 to $84.80 per token without adequately disclosing these transactions. This omission occurred during a critical period as Luna's price was beginning to deteriorate, raising questions about whether Galaxy's undisclosed sales and continued public promotion of the token created misleading market conditions for retail investors.
The $200 million penalty will be paid in installments extending through 2028. Galaxy disclosed the settlement in its earnings statement Friday and has already reserved $166 million in legal provisions to cover the fine, indicating the company anticipated the regulatory action. The settlement represents a significant enforcement milestone for New York authorities, underscoring state-level regulatory efforts to hold cryptocurrency firms accountable for disclosure violations and potentially manipulative trading practices during the Luna ecosystem's turbulent history.
A core allegation centers on Galaxy's failure to publicly disclose significant token sales. Between January 5 and January 13, 2022, Galaxy sold over 1.3 million Luna tokens at prices ranging from $69.15 to $84.80 per token without adequately disclosing these transactions. This omission occurred during a critical period as Luna's price was beginning to deteriorate, raising questions about whether Galaxy's undisclosed sales and continued public promotion of the token created misleading market conditions for retail investors.
The $200 million penalty will be paid in installments extending through 2028. Galaxy disclosed the settlement in its earnings statement Friday and has already reserved $166 million in legal provisions to cover the fine, indicating the company anticipated the regulatory action. The settlement represents a significant enforcement milestone for New York authorities, underscoring state-level regulatory efforts to hold cryptocurrency firms accountable for disclosure violations and potentially manipulative trading practices during the Luna ecosystem's turbulent history.
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