DrawBridge Lending (DBL), a digital asset loaning, borrowing and investing company, has announced that it has received an investment from Michael Novogratz’ owned merchant bank Galaxy Digital with the aim to greatly expand DBL’s institutional investment and lending capacity.
In a press statement, the two companies revealed that they will initially develop a co-branded special-purpose loan funding vehicle (SPV) with a mandate to provide structured financing against institutionally held crypto assets, offering institutions a secure and regulated method for leveraging their digital assets while retaining ownership.
This direct cash investment from Galaxy Digital into DBL will allow the loan and investment capabilities already on DBL’s platform to gain a wider audience.
Galaxy Digital’s founder and CEO Mike Novogratz explained that although crypto institutionalization is new in the industry, it is slowly gaining steam as many companies are being interested in crypto assets and the company has identified DBL as a strategic partner. He said:
“As we look to the future, we recognize the benefit of aligning ourselves with smart and innovative strategic partners who know how to effectively execute in the institutional space.”
According to Cointelegraph, DBL is an authorized lender in the US and is licensed to offer commercial loans in 49 states as well as Washington. The company is also registered as a commodity pool operator as well as commodity trading advisor by the national futures association.
Galaxy Digital has been spreading its investment base to various crypto-based firms and recently entered into a cooperation pact with BlockFi which offers similar services as DBL.
However, according to Jason Urban, DBL’s CEO clarified that his firm utilizes options markets to price all of our loans and investment products, and the options are deemed as swaps by the Commodity Futures Trading Commission. Since swaps cannot be sold to retail investors, all DBL clients must meet certain accreditation threshold requirements.