Galaxy Digital has closed its first tokenized collateralized loan obligation (CLO), using blockchain to bring private credit and crypto-backed loans onchain. The deal, Galaxy CLO 2025-1, was issued on Avalanche and has financed roughly $75 million in loans so far, according to a Thursday announcement. The transaction is anchored by a $50 million allocation from Grove, an institutional credit protocol within the Sky ecosystem, formerly known as MakerDAO.
“By uniting our strengths in debt capital markets, blockchain technology, and asset management, we're opening a new avenue for institutional engagement in credit markets—one that benefits from greater efficiency, transparency, and expanded collateral flexibility through onchain execution,” said Chris Ferraro, president and chief investment officer at Galaxy.
The CLO is designed to support Galaxy’s lending operations through an uncommitted credit facility extended to Arch Lending, a crypto lending platform backed by Galaxy Ventures. Arch issues consumer loans that are overcollateralized with Bitcoin (BTC) and Ether (ETH). Money from the CLO is used to buy these loans as they are created, with the program able to grow to $200 million over time.
Crypto trading platform INX issued the CLO’s bonds and put them on the blockchain. The tokens are expected to be listed on INX’s platform for approved investors. The safest portion of the CLO pays interest at a rate tied to the Secured Overnight Financing Rate, or SOFR, plus 5.7%, matures in December 2026 and makes monthly payments, per the announcement.
Galaxy’s internal teams handled the structuring and blockchain setup, while Galaxy Asset Management oversees the product. Anchorage Digital Bank acts as trustee and custodian, tracking collateral and settlements in real time using its blockchain infrastructure. Galaxy also partnered with Accountable, a data platform that lets investors continuously monitor loan performance and collateral backing the CLO.
