"Currency Goldman Sachs" Galaxy DIgital's Waterloo
Editor's Note: This article comes fromBitcoinnews (ID: bitcoinnews), Author: Chaosmosreads, reproduced by Odaily with authorization.
Editor's Note: This article comes from
Bitcoinnews (ID: bitcoinnews) , Author: Chaosmosreads, reproduced by Odaily with authorization. Coin News, Galaxy Digital, known as "Goldman Sachs in the currency circle", released its annual report for the 2019 fiscal year. The reporter studied the annual reports of Galaxy Digital in the past two years and found that under the prestige, the company's actual operating status is extremely pessimistic. November 2017 was at the peak of the Bitcoin bull market. Galaxy Digital was also established at this time. Since its establishment, Galaxy Digital has become a symbol of "traditional finance entering the cryptocurrency market" and has been highly praised. The reporter once heard Mike Novogratz's speech at the Consensus Investment Conference held by CoinDesk in New York at the end of November 2017, and he sang about Bitcoin, which was exciting. High operating costs, lackluster revenue image description Galaxy Digital 2019 Financial Report Galaxy Digital 2018 Financial Report The first thing that caught people's attention in the earnings report was Galaxy Digital's high operating costs. In 2019, the company's operating expenses were US$82 million and its net income was US$25 million. In 2018, the company's operating expenses were US$88 million, with a net loss of US$270 million. In contrast, the Ethereum Foundation, which has been criticized by the community for its extravagance and chaotic management, has an annual budget of only 30 million US dollars. image description Galaxy Digital 2018'19 Executive Earnings Looking at the financial report, it can be found that in 2018 and 19, when the performance was dismal and investors and shareholders suffered huge losses, the total compensation of Galaxy Digital executives reached 57 million US dollars. To make matters worse, the high operating expenses did not bring sustainable income to Galaxy Digital. Galaxy Digital listed trading, investment, asset management, and consulting as its main business, and part of the cost was stripped to "company-related" items. Inside. Galaxy Digital’s transaction business recorded a loss of US$180 million in 2018 and recorded a revenue of US$52 million in 2019. The reason is that in the 2018 financial report, after the company purchased cryptocurrencies at the peak of the bull market in early 2018, it deducted the value of cryptocurrencies based on the bottom price of the bear market at the end of 2018. During the rebound in 2019, it sold some cryptocurrencies and Investment products, including its majority stake in Block.one. This part of the revenue sold after the rebound constitutes the company's main revenue and "profit" in 2019. Galaxy Digital's consulting business had a revenue of US$970,000 in 2018, with a net loss of US$7 million, and a revenue of US$390,000 in 2019, with a net loss of US$7.7 million. secondary title The liquidity of Pantera's investment assets is in doubt Galaxy Digital's 2019 financial report investment assets secondary title image description Galaxy Digital's cryptocurrency holdings 2019 earnings report According to the financial report, Galaxy Digital has cleared the positions of Ethereum, EOS, and Monero in the past year, and currently only holds Bitcoin, FTX Token, and some stable coins. As of the end of 2019, the average cost is about 7,400 US dollars. According to the current price of Bitcoin , this part of the position has generated a small floating loss. Galaxy Digital's Cash Reserve 2019 Earnings According to the financial report, Galaxy Digital's cash reserves are not optimistic. As of the end of 2019, its cash reserves were US$106 million, which can only last for 16 months based on an annual operating cost of US$80 million. Four months have passed in 2020. In the next year, if the cryptocurrency market does not rise sharply, Galaxy Digital will face a severe test. image descriptionThe prosperity of the past is vivid. Looking at Galaxy Digital's 2018 and 2019 financial reports today, the company is like a sinking ship that is leaking. And the senior management team at the helm is still receiving a huge annual salary.
Can Galaxy Digital's investment business save the company?
According to financial report statistics, this part of the investment seems to have a small loss. However, since the price changes in the primary market are slower than those in the secondary market, the real value and realizability of this part of the investment are doubtful. The loss of the Pantera ICO Fund represents the current market value of these primary market investment products to a certain extent. .
