🥛 GLXY made $323M. Now for the hard part 🏗️

🥛 GLXY made $323M. Now for the hard part 🏗️

Both halves of GLXY are working. Only one is predictable.

GM. This is Milk Road, the crypto newsletter that connects the dots between Wall Street and the blockchain.

Here’s what we’ve got for you today:

• ✍️ GLXY made $323M… now for the hard part.

• 🎙️ The Milk Road Show: CryptosRUs: Bitcoin Could 3X by 2030 - But These 5 Altcoins Could 10X.

• 🍪 Aave leads lending, but revenue lags.

You own Bitcoin. You want to keep owning Bitcoin. But you also need cash. Get the cash without selling on Ledn.

GALAXY MADE $323M… NOW FOR THE HARD PART 🏗️

Galaxy Digital (Mike Novogratz's crypto firm turned AI data center landlord) reported earnings yesterday morning.

… and the numbers came in way ahead of what Wall Street expected:

• Net income: $323M, after an $85M loss last quarter.

• Adjusted earnings per share: $0.83, against ~$0.11 expected.

• Cash, stablecoins and Treasuries: $4.9B.

It’s good timing too, since the stock had dropped ~32% in the month heading into the report.

To see why this quarter looked so good (and why the next one might not), you need to know Galaxy runs two very different businesses under one roof:

1. A crypto business: Trading, lending and asset management for big clients, plus a large portfolio of its own crypto and startup stakes.

2. A data center business: A West Texas campus called Helios, leased to the AI cloud company CoreWeave.

Most of this quarter's profit came from the first one.

Galaxy's treasury segment produced $395M of adjusted EBITDA (earnings before interest, taxes, depreciation and amortization), after losing $78M the quarter before.

That's mostly gains on what Galaxy holds.

Bitcoin went from ~$58.6K at the end of June to ~$83.5K at the end of September.

Trouble is, those gains cut both ways. 👇

A year ago, Galaxy made $505M in a quarter. The very next quarter, it lost $482M as crypto prices fell.

And Bitcoin is back around $80K today, below where it ended in September.

I.e. The crypto side can carry one quarter, but nobody can count on it to carry the next.

So Galaxy's plan for steadier profits lives in West Texas…

GET LIQUID WITHOUT SELLING BITCOIN

You own Bitcoin. You want to keep owning Bitcoin. And sometimes you need cash.

Ledn lets eligible borrowers use BTC as collateral and access dollars without selling their Bitcoin.

What you need to know before you borrow:

• 50% starting LTV gives the loan room before liquidation.

• 12-month terms, no monthly payments and no early repayment penalty.

APR starts at 11.49% for smaller loans, with lower advertised tiers for bigger loans. Rates vary by jurisdiction.

Ledn never lends collateral to generate interest.

Borrowing carries interest costs and liquidation risk if BTC falls.

See the Bitcoin loan rates, terms and risks in our full guide.

GALAXY MADE $323M… NOW FOR THE HARD PART (P2) 🏗️

The Helios data center is leased to CoreWeave for 15 years, and CoreWeave covers the power, taxes and maintenance on it.

The first phase (133 megawatts of computing capacity) was fully delivered by the end of June, so Q3 was its first full quarter of rent.

The data center business's EBITDA jumped almost 6x, from ~$11.5M to ~$69M.

And that's only the first slice of what CoreWeave has signed up for. 👇

Once all three phases are running in 2028, M0xt estimates Helios will bring in over $1.2B of rent a year on average.

That's the kind of steady income the crypto side can't offer, but there’re a few things to keep an eye on:

• The data center segment still posted a small net loss (~$435K), where M0xt had hoped for its first profit.

• CoreWeave is the only tenant, and the market got nervous about its debt this month. Kyle (our Head of Research) pointed out its unsecured bonds were yielding ~15% (i.e. lenders are demanding higher returns because they see CoreWeave as risky).

• Phase II is being paid for with a $3.5B bond, and the next 830 megawatts of approved power at Helios still has no tenant.

Galaxy did throw shareholders a bone, adding $200M to its buyback after repurchasing 9.8M shares this year.

A buyback top-up was on M0xt's wishlist going into the report, so he got one of his asks.

All told, both halves of Galaxy are working, but only one of them is predictable.

SEE WHAT INSIDERS OWN

The biggest investors in the world leave a paper trail…

…but it's scattered across SEC filings, political disclosures and block explorers.

So we pulled it all into one place: Insider Portfolios, now live on Milk Road.

Track Vitalik Buterin, Warren Buffett, Nvidia, Nancy Pelosi and more:

• See every position they hold, plus what they've added or sold lately.

• Click any coin or stock to see which insiders own it.

• Get an email the next time they make a move.

The best part? Your account is already set up.

To turn on free Insider Portfolio alerts, simply sign in and click the bell notification icon on your preferred Insider page.

👉 Sign in here to access Insider Portfolio alerts.

BITE-SIZED COOKIES FOR THE ROAD 🍪

Wealthy investors ranked crypto above stocks as the best way to build wealth over 10 years. But only 2% plan to hold it that long. Why though?*

26 companies say no to tokenization: Firms worth ~$13.6T combined have told OKX and ICE not to tokenize their shares, including Microsoft, Alphabet and IBM.

ETH ETFs are bleeding: They lost $629M over the last 11 trading days, while BTC ETFs took in $183M over the same stretch.

Aave leads lending, but revenue lags: V3 holds 31.7% of lending TVL, yet the last 30 days brought $4.95M, a $60M pace vs. $91.2M over the past year.

*this is sponsored content.

See the Bitcoin loan rates, terms and risks in our full guide.