Crypto Firm BlockFi Raises $30 Million in Series B Funding

New York-based BlockFi, a provider of , has raised $30 million in Series B funding led by Valar Ventures, with participation from a host of other investors.
Valar is an early-stage venture-capital company led by PayPal co-founder Peter Thiel, who has been an active investor in fintech over recent years. The billionaire was an early investor in the UK money-transfer business TransferWise, as well as backing the German fintech startups N26 and Deposit Solutions.

Morgan Creek Digital, PJC, Akuna Capital, CMT Digital, Avon Ventures, Castle Island Ventures, Purple Arch Ventures, Kenetic Capital, Winklevoss Capital, Arrington XRP Capital, and Hong Kong-based HashKey Capital also contributed in the latest financing round.
“We were proud to have made our first investment in the crypto sector with BlockFi, and we’re excited to continue propelling the company forward as they define the industry standard for what a modern financial services company for cryptocurrency looks like,” said Andrew McCormack, general partner at Valar Ventures.
BlockFi is backed by billionaire Mike Novogratz’s Galaxy Capital, which in 2018 raised nearly $58 million in various funding rounds. The Winklevoss twins’  is also providing custody of BlockFi accounts, which recently added digital asset insurance coverage.
The new investment will enable the firm to build out new products and expand its existing platform, which includes interest-earning accounts for Bitcoin and crypto-backed USD loans.
BlockFi offers interest-bearing deposit accounts
According to the company’s statement,  has attracted so far over $650 million in deposits from retail, corporate, and institutional crypto investors.
BlockFi launched its service earlier in March 2019, offering loans to those who are interested in borrowing crypto, starting from $2,000 and go as high as $100 million, against bitcoin, ethereum and stablecoins at an 8.6 percent interest rate. The crypto startup is also offering a 3.8 percent annualized rate on Litecoin deposits, as part of its offering for .
While BlockFi is advertising its annualized returns paid in Bitcoin or Ether, according to the product’s terms and conditions page, the company can modify the rate each month at its sole discretion.
The startup pays crypto deposits interest rates from 4 to 12 percent. However, the actual interest rate is set on a month-to-month basis and is based on a combination of rates BlockFi sees in the institutional cryptocurrency borrowing market.
“At BlockFi, we believe that access to wealth-building financial products shouldn’t be limited by geography or net worth. With this investment, we’re one step closer to realizing that vision,” said Zac Prince, CEO and co-founder, BlockFi.
“For most people, cryptocurrencies are something out of speculative fiction. Adoption of these assets is limited by the average consumer’s ability to understand how to use them,” added Flori Marquez, VP of operations and co-founder of BlockFi.

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