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Galaxy Digital, a major U.S. financial services and digital asset firm, announced on the 15th that it has successfully completed the issuance process for a tokenized collateralized loan obligation (CLO) on the Avalanche (AVAX) blockchain.
Avalanche,Technology Built for Institutions.
Galaxy is introducing a first-of-its-kind tokenized CLO, issued exclusively on Avalanche with a $50M allocation from Grove🧵 pic.twitter.com/vYzVVvrZOF
— Avalanche🔺 (@avax) January 15, 2026
The transaction totaled $75 million, with $50 million anchored by Grove, an institutional-focused on-chain credit protocol. This marks Galaxy Digital’s first-ever CLO issuance, representing a major milestone in the firm’s expansion into blockchain-based private credit markets.
The debt tokenization was executed by INX, and the issued CLO is expected to be listed on INX’s regulated trading platform. Sam Paderewski, co-founder of Grove Labs, described the deal as “a significant step forward for on-chain credit infrastructure.”
A New On-Chain Credit Model for Institutional Investors
The tokenized CLO offers monthly payments at a rate of overnight secured financing rate (SOFR) plus 5.7%, with maturity set for December 2026.
Proceeds from the issuance will be used to establish a credit facility for Arch Lending, a crypto lending firm that provides loans backed by Bitcoin (BTC) and Ethereum (ETH). The facility is structured to expand up to $200 million, depending on loan origination activity.
Grove Labs selected the Avalanche blockchain as its core infrastructure partner for institutional credit transactions, citing predictable settlement finality and low transaction fees as key advantages for programmatic capital deployment.
Diversification Strategy and Blockchain Innovation
The CLO issuance aligns with Galaxy Digital’s broader strategy to evolve from a crypto investment firm into a full-spectrum financial services company powered by blockchain technology.
The firm has recently accelerated diversification efforts, including a $460 million investment to convert a Texas facility into an AI-focused data center, signaling expansion beyond digital assets alone.
From a technical standpoint, Anchorage Digital Bank serves as trustee and custodian, enabling real-time tracking of collateral and settlements via blockchain infrastructure. Accountable is responsible for continuous monitoring of loan performance and collateral ratios, while Galaxy Asset Management oversees the product structure.
By bringing private credit fully on-chain, Galaxy aims to unlock instant settlement, enhanced transparency, and improved secondary market liquidity and all while maintaining regulatory compliance.
The initiative reflects CEO Mike Novogratz’s long-standing vision of bridging traditional finance with blockchain infrastructure. If successful, the model could serve as a blueprint for compliant, on-chain private credit markets globally.
