ARK Invest

Time for the Crypto community to address the elephant in the room. Between AI-driven attacks, quantum, and hacks getting bigger every year, we need to talk about a 2–3 year window where chains can roll-back in extreme cases. You think it’s Controversial? Sure. But talk privately to people in this industry and most will admit they agree. I am sure you’d find more agreement across communities than you’d expect. The practical reality: ~90% of funds sit on BTC, ETH and SOL. We basically need three communities to agree. Blockchains today are not prepared for true black swan events and we have many knocking at the door, We should be honest about that. Call it a hardening period. But validator-level coordination and roll-back needs to be on the table.

Tokenized equities are going on-chain FAST. Monthly spot volume hit ~$30B in September, up from under $1B in Jan 2025. And the mix has flipped: DEXs went from a rounding error to ~80% of volume in three months, led by @Uniswap. My bet: within 12 months, a major exchange does more equity volume on-chain than through its traditional brokerage.

On the OKX/ICE issuer refusal, people need to understand how confusing this market is right now. We have 5–10 different wrappers for the exact same equity. As things stand, it’s hard to see how this improves liquidity, let alone composability or programmability. I think we will run the same playbook as stablecoins: platform-neutral equities will win and the market will consolidate. But today, the value proposition is weak. You basically need a PhD in wrapper archaeology just to buy one share.

$GLXY at $17 is a weird setup. You’re basically buying an AI data center company and getting a growing crypto business thrown in for free. Galaxy reported earnings today. Some quick thoughts The headline numbers look huge: $569M adj. gross profit, $455M adj. EBITDA, $323M net income. But most of it isn’t operating earnings. If you look by segment: Treasury & Corporate: $395M adj. EBITDA (vs –$78M last quarter), ~87% of the total. It’s almost all mark-to-market gains on the investment book after two quarters of losses. Net digital assets & investments rose 48% to $1.72B. Digital Assets: $71M adj. gross profit (+9%) but still –$9M adj. EBITDA. Fundamentals are clearly healthy: trading volume +12% while the spot market shrank, the loan book +27% to $1.8B, and AUM + assets under stake +46% to $10.4B with >$160M of net inflows. They’re gaining share. The problem is that it’s now 4 straight quarters of negative EBITDA, and the street doesn’t believe it can be reliably profitable in this market. Data Centers: $79.1M leasing revenue, $68.7M adj. EBITDA (+498% QoQ). It’s the first full quarter of Helios Phase I, right at the ~$80M/qtr guide with ~87% margins. Phase II (260 MW) is fully financed via $3.5B of notes, with deliveries starting Q2 2027. 830 MW at Helios II is still unleased. Galaxy walked away from a deal there because Texas power is getting scarce and they think they can get better terms. Now the valuation and where I think it gets interesting Phases I + II online = 393 MW leased to CoreWeave on 15-year contracts. At Phase I’s actual rate (~$2.4M revenue per MW per year) and ~89% margins, that’s ~$830M of run-rate EBITDA by late 2027. 15x seems fair for long-dated contracted leases, even with CoreWeave as the single tenant. Discounted back a year, since Phase II only starts delivering in Q2 2027: EV: ~$12.5B, or ~$11.3B discounted – Debt: ~$7.0B ($1.3B Phase I facility + $3.5B Phase II notes + $2.1B exchangeables) Cash & stablecoins: ~$2.1B = ~$6.5B equity, or ~$16.50/share Market cap today: ~$6.5B. So the market is pricing Helios and nothing else. The crypto franchise, the $1.7B investment book and the rest of the data center Biz are all at $0. That feels too aggressive, even with 4 quarters of negative EBITDA. The core trading and lending business is strong. The real open question is how well Galaxy can monetize tokenization and RWAs. If they figure that out, you’re getting it for almost for free at these prices.