Mike Novogratz calls Helios a “transformative acquisition” for Galaxy

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Galaxy Digital Holdings CEO Mike Novogratz called the Helios mining deal a transformative acquisition for the company as it strives to increase its exposure to the Bitcoin mining sector.

The crypto investment firms’ $65 million acquisition of Argo Blockchains’ flagship mining facility was announced on December 28 as part of Argos’ drastic move to avoid bankruptcy.

Tweeting about the deal on December 29, Novogratz emphasized that Galaxy firmly believes in the long-term future of Bitcoin (BTC) and that the company will continue to ramp up its mining initiatives:

Bear markets are for construction. Long believed in BTC and expected cheaper miners to win over time. Helios is a transformative acquisition that will expand our mining capabilities and services as we continue to build for the decentralized future.

Since we started mining bitcoin in Q1 2021, we have outsourced our miners to hosting providers. But we’ve always had the idea of ​​vertically integrating our mining capabilities.

— Mike Novogratz (@novogratz) December 28, 2022

Explaining the deal in more detail, the Galaxy CEO pointed out that the company has a specific thesis on how to approach the mining sector which consists of low cost electricity, a highly efficient team and buying miners. Low-cost ASICs.

This is a recipe for success in mining, even when the hash rate increases, he said.

Recent data from the Hashrate Index revealed that Bitcoin ASIC miner prices are hovering at levels not seen since at least 2021, with the most efficient ASIC miners seeing their prices drop 86.8% from their May 2021 high.

Galaxy has five business segments in trading, asset management, crypto mining, venture capital investments, and investment banking. According to its website, it currently has $1.9 billion in assets under management.

As it stands, Galaxy has primarily used hosting services for its mining operations, but Novogratz notes that owning a 200 megawatt (MW) Helios capacity will not only allow the company to operate miners on its own site, but also to host others.

Helios potentially has a lot of scalability to make it one of the biggest miners out there. Argo Blockchain previously reported in May this year that it plans to increase power capacity to 800MW in the coming years.

At the time, the company also stated that it expected Helios to reach a BTC mining capacity of 5.5 exahashes per second by the end of the year, with the potential to eventually reach 20 p.e./s.

It looks like Galaxy has money to spend in mid-bear 2022, given that it also gave Argo Blockchain a $35 million equipment financing loan alongside the acquisition.

Related: BTC Price Preserves $16.5,000, But Funding Rates Increase Risk Of New Bitcoin Lows

The move also adds another coup from earlier this month in which Galaxy seized self-service crypto-custody platform GK8 for an undisclosed sum.

GK8 was auctioned off as part of Celsius’ bankruptcy process, after the defunct cryptocurrency lender bought the company for $115 million in 2021.

Mike Novogratz, founder and CEO of Galaxy, called the acquisition a crucial cornerstone in our efforts to create a true full-service financial platform for digital assets.

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