2025 was a tumultuous year for digital asset and diversified financial services company Galaxy Digital Holdings Ltd. (NASDAQ: GLXY). Shares dipped below $9 in April and then catapulted to nearly $43 later in the year before retreating in the final weeks. The most recent share price action was likely the result of investor concern about dilution following Galaxy's announcement of an approximately $1 billion exchangeable notes offering in October.
Long known as a Bitcoin company, Galaxy's suffering was also at least partially caused by the supercharged digital asset rally losing steam late in 2025. However, there is a real case for Galaxy's business heading into the new year, and investors should not underestimate the firm.
An impressive third-quarter earnings report highlights some major successes, and the company is joining many of its peers in the digital asset space to leverage its infrastructure to capitalize on data center demand.
At the same time, the company's decision to maintain its legacy digital asset business distinguishes it from crypto peers and may present either an added opportunity or an unwarranted risk, depending on the investor's perspective.
A Closer Look at Galaxy Digital's Earnings
Galaxy Digital's latest quarterly report, for the third quarter of 2025, had a number of bright spots. The company reported net income of $505 million, a massive increase of about 1,500% on a sequential basis. These gains were largely the result of the firm's Global Markets business. Digital asset trading volumes surged by 140% year-over-year (YOY) to all-time high levels, and average loan book size expanded to $1.8 billion. The company also executed a notional Bitcoin sale of $9 billion.
Galaxy's Asset Management & Infrastructure Solutions business is also thriving, as it saw more than $2 billion of net inflows for the quarter and ended the period with almost $9 billion in assets under management. The company continues to draw long-term staking and asset management agreements with digital asset treasury companies, solidifying its core business.
For investors concerned about a digital asset company's balance sheet, Galaxy offers reassurance. It ended the third quarter with $1.9 billion in cash and stablecoins and a total equity value of $3.2 billion. This points to its capacity to be resilient in the face of future cryptocurrency market destabilization.
Potential in the Data Center Space
It's become increasingly common for cryptocurrency-focused firms to shift their operations toward AI and data center applications, and Galaxy is no exception. The company gained significant momentum in these efforts in August 2025 when it announced the closing of a $1.4 billion project financing facility to fund its Helios data center project in Texas. The company's long-term agreement with CoreWeave Inc. (NASDAQ: CRWV) should see it deliver its first phase of power early this year.
The data center business is booming, and the Helios campus is expected to generate as much as $1 billion in annual revenue once completed. For investors, an interesting aspect of Galaxy Digital's approach to the industry-wide shift toward data centers is that the company is not abandoning its traditional digital asset business. While other firms have executed a full-scale pivot, Galaxy's strong momentum in its legacy operations shows no signs of slowing. Keeping both sets of operations could allow the company to achieve recurring revenue stability with its infrastructure while also meeting continued demand for digital asset services in a more turbulent market.
Risks in the Crypto Space Linger
Of course, staying involved in the cryptocurrency space means that Galaxy will remain exposed to selloffs, including the most recent example late in 2025.
For the time being, the company is still heavily reliant on crypto trading, so changes in the market can have an outsized impact on Galaxy's performance. As its mix shifts toward data center revenue, this could stabilize quite a bit.
There are many reasons to be bullish on Galaxy Digital in 2026, and analysts across Wall Street are leading the way in calling for a banner year. 12 out of 14 have issued Buy or similar ratings on GLXY stock.
Despite its share price fluctuations in the last year, the consensus among analysts is that Galaxy has more upside in store: the company is expected to boost the price of shares to $46, nearly two-thirds above where it is trading as of mid-January.
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The article "The Bullish Case for Galaxy Digital in 2026" first appeared on MarketBeat.
