Grove serves as the warehouse lender, financing Galaxy’s origination of institutional loans secured by digital assets.
Grove, an institutional-grade credit infrastructure protocol designed to serve as the liquidity engine of onchain finance, announced a $500 million warehouse lending facility with Galaxy Digital. Grove serves as the warehouse lender, providing capital to finance Galaxy’s origination of institutional loans secured by digital assets. The facility deepens a growing relationship between the two firms.
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Grove and Galaxy warehouse facility
A warehouse facility is a credit line provided to an originator to help finance its lending business. The originator underwrites and originates loans, while the warehouse lender supplies capital secured against the resulting loan portfolio. Mortgage lenders and auto finance companies have funded their books this way for decades.
The Grove and Galaxy facility applies the same structure to crypto-backed lending. Galaxy is the originator: underwriting loans to institutional clients, taking digital asset collateral, and servicing them through its existing operations. Grove is the warehouse lender, committing USDS capital through a dedicated lending vehicle.
At a glance:
- Facility: $500 million
- Warehouse lender: Grove
- Originator and servicer: Galaxy
- Eligible collateral: BTC and ETH, including natively staked and liquid-staked ETH
- Qualified custodians: Anchorage Digital and BitGo
- Loan profile: Senior secured and fully funded. Original terms of two years or less.
- Concentration limits: ETH-backed loans up to 50% of the facility, staked ETH up to 50% of that share
- Price feeds: Chronicle, with loan-to-value monitored continuously
Inside the warehouse
The facility is secured at two levels. Grove’s financing is secured against the portfolio of loans itself, while each underlying loan is overcollateralized with cryptocurrency pledged by the borrower. Eligible collateral is limited to BTC and ETH, including natively staked and liquid-staked ETH, held with qualified custodians Anchorage Digital and BitGo.
Only loans that meet defined eligibility criteria can enter the portfolio:
- Senior secured and fully funded, with a first-priority security interest in the borrower’s pledged cryptocurrency.
- Original terms of no more than two years. No more than 20 percent of the facility can sit in loans with original terms beyond one year, so the book skews short-dated.
- Denominated in dollars or approved stablecoins, with interest paid at least monthly.
- Advance rates are tiered by collateral type and borrower profile.
Concentration limits cap ETH-backed loans at half the facility, and staked ETH at half of that ETH share. Loan-to-value is monitored continuously against independent price feeds from Chronicle.
Grove’s role: an evolving partnership with Galaxy
In December of 2025, Grove anchored Galaxy’s first tokenized CLO with a $50 million participation. A CLO is a structured credit product similar to a warehouse: a pool of loans bundled together, with debt tranches of varying risk and return sold to finance the portfolio. Buying into a CLO means buying exposure to those loans after they have already been originated, underwritten, and packaged into a tradable form.
This warehouse facility moves Grove one step earlier in that process. Instead of buying an interest in a pool of finished loans, Grove now provides the funding Galaxy uses to originate new loans. The position sits earlier in the credit chain, closer to origination and collateral than a secondary CLO interest.
Why this matters
Galaxy receives committed warehouse capacity to support its institutional crypto-backed lending book. Through the facility, Grove provides warehouse financing to Galaxy, secured against a portfolio of overcollateralized, institutionally underwritten crypto-backed loans that Galaxy originates and services. The structure sits closer to origination and collateral than secondary CLO participation.
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