Investor concerns about Galaxy Digital (GLXY.TO) being subject to significant losses given its exposure to Terra’s LUNA token are “clearly unwarranted,” BTIG equity research analyst Mark Palmer told clients in a note Thursday.
Shares of Galaxy have plunged more than 40% this week and were down over 20% on Wednesday. They were falling 1.6% to $8.02 on Thursday.
In its recent management discussion and analysis filing for the quarter ending March 31, Galaxy said that the largest contributor in the quarter to the $355 million in net realized gains on its digital assets came from sales of LUNA. Galaxy had previously said in its fourth quarter earnings release that it held $407.6 million worth of LUNA as of Dec. 31.
Galaxy did not immediately respond to a request for comment.
Algorithmic stablecoin TerraUSD (UST) recently lost its 1:1 peg to the U.S. dollar, while Terra’s native LUNA token extended its precipitous decline this week.
BTIG reiterated a buy rating on Galaxy with a C$37 ($28) price target.