Update on GLXY and shift in political view of DA

Recently, I sent a piece titled "Concentrated portfolio approach versus diversified portfolio." SWCM investors have a very large and concentrated position in Galaxy Digital. I wanted to provide you with an update on the Galaxy business and the digital asset sector.

Galaxy Digital

Galaxy Digital (GLXY) recently released its 1st quarter earnings, and the results are impressive. The company earned a whopping $425 million for the quarter, surpassing expectations. All business lines are performing exceptionally well. The Book Value for the firm has reached $2.2 billion and is expected to increase further over the full year. The stock trades near 1.6x Book Value, while Coinbase trades at 6x book value. If GLXY were valued similarly, it would be near $50.00 per share.

One key factor holding back potential investors is Galaxy stock trades on the NASDAQ OTC market under the symbol BRPHF. However, this is set to change in the near term. The Galaxy team has been diligently updating the SEC with the necessary documents, and the SEC is currently reviewing the uplisting.

The Biden Administration and the SEC Chair have significantly altered their stance on digital assets.  Recent policy changes:

The SEC recently approved an ETF for Ethereum, previously deemed an almost impossible move 2 weeks ago.

Despite the president's initial veto threats, the House and Senate have passed two pro-digital asset legislations. The administration has since retracted the veto threat.

The Biden Administration has recently reached out to leaders in the crypto industry to discuss a better framework for regulatory environments. 

Hester Pierce, an SEC board member and SEC Commissioner, proposed a USA and UK Regulatory 'Sandbox' For Crypto Companies, Offering a 2-year safe Harbor to Decentralize Blockchains. 

This change in sentiment could push the SEC to approve Galaxy's uplisting by the end of the year. GLXY is actively collaborating with the SEC to expedite the uplisting process. Uplisting to the NASDAQ will increase volume, allow many larger institutions to buy the stock, increase US visibility, and allow options trading on Galaxy stock.   All of which should allow the stock to trade at a higher multiple value.  

Bitcoin

Overall, we are on the cusp of what could be a significant upward surge for Bitcoin and Galaxy Digital's stock price.  The macro environment is shifting in a positive direction, the political climate is now favoring digital assets, and the possibility of Bitcoin making another climb to new highs is very real. These factors combined could potentially propel the stock to new heights.  Staying long and being a buyer is crucial if you're not already invested.  

Attached is a comparable chart of Bitcoin's price movement, showing similar chart action from 2018. We are on the verge of a similar price move.   

Stay long and be a buyer if you have not already invested. More to follow.  

If you own an old 401k or retirement account, it's time to roll it over to an IRA and invest wisely. I am always willing to discuss this approach to investing If there is anything on your mind regarding your investment portfolio, please do not hesitate to call or reply to this email.  I am always here to provide you with resources.

Disclaimer:

The information in this material is for general information only and is those of the author, not a recommendation or solicitation to buy or sell investment products. This material was developed and produced by James Sullivan who is not affiliated with the named broker-dealer. Always consult with a tax or legal advisor for a comprehensive review of your situation.  Dollar-cost averaging will not guarantee a profit or protect you from loss but may reduce your average cost per share in a fluctuating market. Investors cannot invest directly in indexes. The performance of any index is not indicative of the performance of any investment and does not take into account the effects of inflation and the fees and expenses associated with investing.  A diversified portfolio does not assure a profit or protect against loss in a declining market. All investing involves risk, including the possible loss of principal. There is no assurance that any investment strategy will be successful.