Galaxy, founded by Mike Novogratz, announces a partnership with the second-largest Ethereum treasury operator, Sharplink, for a “DeFi fund” exceeding $125 million to be used for higher yields generated from staked ETH investments. The idea is to move beyond the low yield of just keeping the ETH in a wallet into more performative strategies, i.e., earning interest from lending and providing liquidity, which can regularly produce annual returns of 10 percent or more.
What the Galaxy Sharplink Onchain Yield Fund Offers
The Galaxy Sharplink Onchain Yield Fund represents an important step for institutional decentralized finance (DeFi) and crypto use cases. Key aspects include:
- Sharplink’s ETH treasury will supply $100 million towards the overall $125 million fund (as of now, Sharplink has approximately 872,984 ETH worth an estimated $2.1 billion in the treasury).
- $25 million in initial funding from Galaxy; the firm will be the ongoing exclusive manager of the fund.
- The Galaxy Sharplink Onchain Yield Fund will employ multiple strategies for achieving initial target returns, including lending, providing liquidity, and other institutional-quality DeFi protocols.
- Risk Management will be achieved by Galaxy sizing the amount of the fund’s total value available to each specific investment strategy, identifying protocols to use, and then monitoring the ongoing risk of those protocols.
- Galaxy anticipates the launch of the Fund in the coming weeks.
For Sharplink, which has already generated $44.6 million in returns from staking since June 2025, the fund represents the next stage of making its ether more productive. CEO Joseph Chalom, formerly BlackRock’s head of digital assets strategy, stated that “our job as an Ethereum treasury company is to make our ether productive first and, over time, to maximize that productivity.”
Why this DeFi Fund matters for the crypto industry
This launch comes at a challenging time for the DeFi sector. April 2026 saw two major exploits [Drift Protocol ($285 million) and KelpDAO ($292 million)] that shook investors’ confidence. The Kelp attack also triggered a $9 billion rush out of Aave. However, Chalom argues that these events are not a reason to retreat but to raise standards. “Out of any financial crisis, whether in traditional finance, DeFi, or other sectors, you end up raising the standards for the next wave of entrants,” he said. “Those in DeFi who take the time to put security first will be the survivors, and we’re going to support and invest in those protocols.”
The Galaxy Sharplink Onchain Yield Fund signals that institutional capital is still moving onchain, but with a sharper focus on security and risk management. Galaxy’s expertise in asset management and onchain deployments, combined with Sharplink’s long term ETH capital, creates what Chalom calls “a really powerful combination.”
But competitors are also trying to capitalize on the sector. Recently, a16z raised $2.2 billion in major new fund push. State Street has launched its SWEEP fund for onchain management on Solana, and the list goes on. Though good news for the sector, as it pushes for better products.