Galaxy Digital Completes $75 Million Tokenized Loan on Avalanche Ecosystem

Galaxy Digital Closes First $75 Million Tokenized CLO

Galaxy Digital has finalized its first tokenized CLO (Collateralized Loan Obligation), bringing private credit to the blockchain infrastructure. In an announcement made on Thursday, the transaction known as Galaxy CLO 2025-1 was issued on Avalanche and has so far financed approximately $75 million in loans.

The transaction is backed by an allocation of around $50 million from Grove, an institutional credit protocol in the Sky ecosystem, formerly known as MakerDAO. Chris Ferraro, President and Chief Investment Officer at Galaxy, stated: "By combining our strengths in debt capital markets, blockchain technology, and asset management, we are opening a new avenue for institutional engagement in credit markets—one that benefits from greater efficiency, transparency, and enhanced collateral flexibility through on-chain execution."

Galaxy noted that the CLO is designed to support its lending operations through an extended unsecured credit facility to Arch Lending, a crypto lending platform backed by Galaxy Ventures. The funds from the CLO are utilized to acquire these loans as they are created, with the program having the capacity to grow to $200 million over time.

Galaxy collaborated with crypto trading platform INX for the issuance of the CLO bonds, which will be listed on the INX platform for approved investors. The safest portion of the CLO pays interest at a rate linked to the Secured Overnight Financing Rate (SOFR), plus 5.7%, maturing in December 2026 with monthly payments.

In a recent report, Galaxy Research predicted that stablecoins could manage a transaction volume greater than the U.S. Automated Clearing House system by 2026. The company observed that stablecoins are already processing more transactions than major card networks like Visa.