Overview
Galaxy (NASDAQ: GLXY) is a publicly listed financial services firm operating at the intersection of traditional finance and digital assets. With business lines spanning trading, asset management, investment banking, and venture investing, Galaxy is a leading player in institutional digital assets.
As part of its onchain strategy, Galaxy actively uses Aave to manage treasury, enhance capital efficiency, and support the creation of structured DeFi products. By leveraging Aave’s decentralized liquidity infrastructure, Galaxy reduces reliance on centralized counterparties while gaining real-time access to scalable credit markets. Galaxy’s usage of Aave underscores a growing institutional shift toward DeFi as critical financial infrastructure.
“Aave has proven to be a highly reliable platform for accessing liquidity. It’s a core primary venue for borrowing stablecoins against blue-chip assets like BTC and ETH, offering 24/7 availability, without third-party intermediaries.”
– Max Bareiss, Head of Lending at Galaxy Trading
1. Borrowing Stablecoins Against Blue-Chip Collateral
Why Aave:
Galaxy chose to use Aave due to its established reputation in DeFi and dominance in lending. Aave offers competitive borrowing costs, strong risk management, transparency, and deep, reliable liquidity capable of supporting institutional-scale transactions. Galaxy uses Aave to borrow a variety of assets, including stablecoins like USDC and GHO. Through Aave’s permissionless platform, Galaxy gains access to 24/7 liquidity with no counterparty approval, providing the flexibility, speed, and scale needed to support institutional desks.
How it works:
Galaxy leverages Aave across a variety of chains to borrow against digital assets such as cbBTC and ETH. The borrowed capital is used to support client trading activity, enhance balance sheet liquidity, and execute short-term lending strategies at institutional scale.
2. Credit Facility
Why Aave:
Galaxy leverages Aave for bridge loans and flexible lines of credit. The open-term borrowing structure enables dynamic interest rate adjustments, which is particularly effective for counterparties that borrow on a variable basis. Galaxy values Aave’s deep liquidity, transparency, and predictable interest rate environment, which make it a preferred platform for these types of transactions.
3. GHO-Based Yield Strategies
Why GHO:
GHO is Aave’s native stablecoin – an overcollateralized stablecoin with fixed yield, which offers predictable risk management and frictionless trading within Aave’s markets. sGHO, or Savings GHO, is Aave’s yield-bearing version of its native stablecoin, designed to provide predictable, low-risk returns. By holding idle balances in sGHO, Galaxy is able to keep liquidity productive while maintaining capital efficiency and deep integration within Aave’s ecosystem.
How it works:
When Galaxy has idle stablecoin balances, it converts them into sGHO within Aave. These balances automatically accrue interest at the Savings Rate, delivering stable, protocol-native yield. This creates a conservative and efficient way to manage treasury liquidity, ensuring idle capital compounds value with minimal risk and operational overhead.
4. Why Aave?
Galaxy integrates Aave across its trading, treasury, and lending workflows to manage capital efficiently and reduce reliance on centralized platforms. Aave provides:
- 24/7 access to deep stablecoin liquidity using blue-chip collateral like cbBTC and ETH
- Transparent interest rates and clear risk parameters
- Scalable infrastructure to deploy and unwind large positions
- Native stablecoin (GHO) for high yield, low risk strategies
- Compatibility with enterprise custody and treasury systems
By embedding Aave into trading, treasury, and lending workflows, Galaxy seeks to improve capital efficiency and transparency, reduce reliance on centralized infrastructure, and diversify counterparty and custodial risks.
5. How Galaxy Integrates with Aave
As part of its broader onchain strategy, Galaxy integrates Aave across trading, lending and treasury desks to enhance liquidity, risk, and capital deployment.
Desks Involved:
- Trading Desk: Sources capital for client execution, hedging, and market-making
- Treasury Team: Improves balance sheet efficiency through onchain borrowing
- Lending Desk: Allocates borrow capacity into OTC and DeFi lending
Custody & Operations:
Galaxy connects to Aave through its internal systems, using MPC-secured wallets to safeguard funds and retain full discretion over capital deployment. This approach illustrates how institutions can incorporate DeFi into their workflows while maintaining control, scalability, and operational rigor.
Learn more about Galaxy’s institutional trading and DeFi strategies. Contact us: https://www.galaxy.com/contact-trading