BlockFi Plans to Raise $100M at a Lower $1B Valuation

Crypto lending platform BlockFi is planning to raise new funding at a depressed $1 billion valuation, Bloomberg reported Wednesday, citing people with knowledge of the matter.

Recall that in March 2021, the company was valued at $3 billion following $350 million raised in a Series D round. 

BlockFi Plans to Raise $100M

According to the report, the firm may raise around $100 million in its planned fundraiser. However, the actual amount it will secure in the funding is yet to be determined. Investors expected to participate in the round include Bain Capital Ventures, DST Global, Castle Island Ventures, and Peter Thiel’s Valar Ventures.

The reduced valuation comes at a time when the crypto market is going through a new phase of turbulence. The total market capitalization dropped from nearly $3 trillion in November to around $1.2 trillion.

The rumored raise also follows BlockFi’s regulatory challenges with United States regulators. In February, BlockFi agreed to pay a $100 million fine to the U.S. Securities and Exchange Commission (SEC), and 32 states.

The SEC charged the company for failing to register its lending product dubbed “BlockFi Interest Accounts” (BIAs). In addition, the crypto firm was charged with violating the registration provisions of the Investment Company Act of 1940.

Investors Continue to Support Crypto Startups

Meanwhile, investors have continued to bet big on crypto firms despite unfavorable market conditions. In May, cryptocurrency exchange Elwood raised $70 million in capital from major financial institutions including Goldman Sachs, Barclays, Dawn Capital, Digital Currency Group, and Galaxy Digital Ventures.

A few weeks ago, American venture capital firm Andreessen Horowitz (a16z) announced it has raised $4.5 billion to support the Web3 ecosystems. 

Blockchain infrastructure provider InfStones recently secured $66 million in funding led by SoftBank Vision Fund 2 and GGV Capital.