Galaxy Digital to pay $200 million to settle LUNA case

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Galaxy Digital to pay $200 million

Key takeaways

- Galaxy Digital settles for $200 million: The crypto investment firm agreed to pay a $200 million settlement to NYAG.

- Regulatory scrutiny intensifies: The settlement is part of broader regulatory action in the U.S., as authorities increase oversight following the collapse of Terra’s LUNA ecosystem and other high-profile crypto failures.

- LUNA continues to decline: The token’s price has dropped to $0.1972, falling more than 7% in a day and 13% over the past month, reflecting sustained market fallout.

Regulatory pressure builds amid market instability

The office asserts that Galaxy Digital generated over $100 million in revenue from LUNA sales by March 2022, without informing investors of its intent to sell or its significant holdings—an omission that New York Attorney General Letitia James called a “serious breach of public trust.”

This settlement follows heightened regulatory scrutiny across the crypto sector. The SEC recently dropped its appeal in the Ripple/XRP case, and the NYAG has ramped up enforcement efforts against digital asset firms operating in its jurisdiction.

The $200 million agreement with Galaxy Digital is among the largest crypto-related settlements in New York’s history and underscores the growing expectation for transparency and accountability from firms operating in the digital asset space.

Despite the regulatory setback, Galaxy Digital is charting a path forward. Founder Mike Novogratz recently noted the firm's continued success across several verticals, including trading, asset management, and blockchain infrastructure. “Big things are happening at Galaxy,” Novogratz stated, underscoring the company's efforts to expand its footprint in the evolving digital asset landscape.

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It's worth noting that Terraform Labs to open claims portal March 31 for crypto creditors. Creditors may submit claims until April 30, 2025, at 11:59 PM ET. Claims submitted after this deadline will not be accepted.

As of press time, the LUNA token is trading at $0.1972, down over 7% in the past 24 hours, and has declined 13% over the past month, continuing its prolonged downturn since the ecosystem's collapse.

LUNA price analysis (Apr 2024 - Mar 2025). Source: CoinGecko

Industry response

The Galaxy Digital case could set a precedent for how regulators handle undisclosed promotional activities tied to financial stakes in crypto assets.

With investor protection at the forefront, additional enforcement actions could follow as agencies increase oversight of token sales and marketing practices.

We also wrote that FCA to roll out stricter crypto regulations by 2026.

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