Galaxy Digital is getting ready to launch a new $100 million investment fund that aims to make money whether crypto prices go up or down. This fund is expected to start in the first quarter and reflects a shift in the market, as the days of non-stop price increases in crypto may be coming to an end.

The fund will invest in two main areas: crypto tokens like Bitcoin, Ethereum, and Solana, and financial stocks tied to blockchain technology and digital assets. The goal is to manage risk while still benefiting from changes in technology, regulation, and market trends.

About 30% of the fund will go directly into crypto tokens. The other 70% will focus on traditional financial companies that are expected to grow due to blockchain adoption, new tech innovations, and upcoming regulations. Galaxy Digital has already secured $100 million in commitments from wealthy individuals, family offices, and select institutional investors. The company will also contribute its own money, although the exact amount hasn’t been shared.

Joe Armao, who will lead the fund, says the crypto market is entering a new phase. While he remains confident in major assets like Ethereum and Solana, he believes that the constant upward trend may be slowing down. Bitcoin is currently trading around $89,185, down about 30% from its high in October and 12% lower over the past year. Still, Armao sees Bitcoin as a key asset, especially if gold and stock markets remain stable during potential interest rate cuts by the U.S. Federal Reserve.

The Galaxy Digital hedge fund reflects how both the crypto and traditional finance worlds are evolving. For example, financial companies like Fiserv have seen their stock prices drop, partly due to new regulations and the increasing impact of blockchain and artificial intelligence.

This fund takes a different approach from typical crypto investments. Instead of only betting on prices going up, it uses a mix of long and short positions. This means it can make money whether prices rise or fall, helping to reduce risk while staying flexible in a fast-changing market.

Galaxy Digital has already shown how this strategy works. Back in September 2025, it bought around $306 million worth of Solana, contributing to a total of more than $1.5 billion in crypto purchases over time.

In addition to the new hedge fund, Galaxy Digital recently completed its first tokenized collateralized loan obligation (CLO) on the Avalanche blockchain. Known as Galaxy CLO 2025-1, this financial structure has already financed about $75 million in loans with backing from Grove, a credit protocol that contributed $50 million. The CLO could expand to $200 million.

These loans are overcollateralized and backed by digital assets like Bitcoin and Ethereum. They are issued through INX and managed by Anchorage Digital Bank, which tracks collateral in real-time. This blend of crypto lending, tokenization, and traditional finance showcases Galaxy Digital’s unique approach.

Experts see this hedge fund as a sign that the crypto industry is maturing. By combining crypto investments with traditional finance strategies, the fund helps big investors take part in digital asset opportunities while lowering risk.

The fund also highlights the growing connection between blockchain technology and traditional finance. With its ability to profit in both rising and falling markets, Galaxy Digital’s hedge fund represents a smarter, more balanced way to invest in today’s shifting financial landscape.

By mixing digital assets with financial infrastructure stocks—and taking both long and short positions—Galaxy Digital is building a flexible strategy designed for a more complex and regulated future. With strong initial funding and innovative projects already in motion, this hedge fund could become a key example of how institutions approach crypto investing going forward.

**Key Terms:**

– **Crypto Tokens**: Digital assets like Bitcoin, Ethereum, and Solana used for investing.
– **Financial Stocks**: Shares in companies involved with blockchain or fintech.
– **Collateralized Loan Obligation (CLO)**: A group of loans bundled together and sold to investors as bonds.
– **Long and Short Positions**: Strategies used to make money when prices go up (long) or down (short).