**Galaxy Launches Tokenized CLO on Avalanche Blockchain, Opening New Doors for Onchain Credit**

Galaxy Digital has taken a big step in bringing traditional finance closer to blockchain technology. The company just announced the successful launch of its first-ever tokenized Collateralized Loan Obligation (CLO), named Galaxy CLO 2025-1. This financial product is built on the Avalanche blockchain and represents a new way for institutions to get involved in onchain credit markets.

The CLO, which is similar to a loan bundle sold to investors, is being used to support Galaxy’s growing lending business. It received a major initial investment of about $50 million from Grove — a credit protocol within the Sky ecosystem, which was previously known as MakerDAO. Grove is backed by Grove Labs, a subsidiary of Steakhouse Financial, known for its expertise in both traditional and decentralized finance.

Chris Ferraro, Galaxy’s President and Chief Investment Officer, highlighted how this innovative structure blends Galaxy’s strengths in blockchain, asset management, and traditional debt markets. He emphasized that this new approach offers better efficiency, more transparency, and greater flexibility through blockchain execution.

The CLO funds are supporting an uncommitted credit facility for Arch Lending, a crypto lending platform supported by Galaxy Ventures. Arch provides consumer loans backed by digital assets like Bitcoin and Ethereum. So far, around $75 million in loans have been financed under this facility. As more loans are created, the CLO can expand up to a total of $200 million.

This launch fits into Galaxy’s strategy of scaling its lending operations using familiar financial tools, but with a blockchain twist. It allows for more efficient capital deployment while offering investors access to innovative credit products with real-time tracking and better security.

Sam Paderewski, Co-Founder of Grove Labs, pointed out that bringing a CLO onchain shows how traditional financial structures can still meet institutional standards when adapted for blockchain. Grove’s support in anchoring the deal highlights its commitment to making high-quality credit products available onchain.

The debt tranches of the CLO were issued and tokenized through the Avalanche network by INX. These tokens will be available for trading on INX’s Alternative Trading System (ATS), owned by Republic. This makes it easier and more affordable for qualified investors to access the product. The CLO offers a senior coupon rate of SOFR + 570 basis points and is set to mature in December 2026, with monthly payouts.

By tokenizing the CLO, Galaxy aims to make private credit more accessible through features like instant settlement, improved transparency, potential for better liquidity, and more effective use of collateral.

Galaxy’s in-house teams handled both the structuring and tokenization of the CLO. Galaxy Asset Management will oversee the product. Anchorage Digital Bank acts as bond trustee and custodian while also managing collateral and settlements using its Atlas Settlement Network. Fund administration will be handled by NAV Consulting.

To boost transparency even further, Galaxy is working with Accountable — a platform that verifies both on-chain and off-chain data in real time. Investors can use an interactive dashboard to monitor loan performance and collateral status live, giving them better insights into risk and helping avoid past issues seen in credit markets.

**About Galaxy Digital**

Galaxy Digital Inc. (Nasdaq/TSX: GLXY) is a global leader in digital assets and AI infrastructure. The company offers institutional services across trading, advisory, asset management, staking, self-custody, and tokenization. It also runs massive data center infrastructure to power AI and high-performance computing, including its 800 MW Helios campus in Texas with another 2.7 GW under development. Headquartered in New York City, Galaxy operates across North America, Europe, the Middle East, and Asia. Learn more at www.galaxy.com.