Bain Capital Ventures Co-Leads BlockFi’s $350M Series D, Bringing Crypto To The Masses

Bitcoin, having now eclipsed $1 trillion in market cap, is continuing to zig zag towards fulfilling its promise as digital gold and a permanent store of value. Custody has always been a curious challenge for Bitcoin. Users have moved through multiple custody solutions in an attempt to store and trade it safely: paper keys, hardware wallets, trusts, and crypto-custodians. 

Whether it’s trusting a hardware device or a crypto-oriented corporation—for most, trusting any third party to store their crypto has been a scary concept. As with most maturing markets, the question of safety of deposits is waning as credible and large platforms emerge that enable consumers and institutions to engage with various types of cryptocurrencies safely. The longer these platforms demonstrate the safety of their procedures the more trusted they will become; trust is earned, not granted.

That’s why BCV is thrilled to be leading BlockFi’s $350 million Series D round alongside DST Global and Pomp Investments, bringing BlockFi’s total funding to $450 million since it was founded in 2017 by two exceptional entrepreneurs, Zac Prince and Flori Marquez. BlockFi’s platform is a bridge between cryptocurrencies and traditional financial and wealth management products. 

Trusted by both individual and institutional investors, BlockFi now manages more than $15 billion in assets and has over 225,000 clients. In 2020, BlockFi increased its client base by 10X compared to 2019, and its client base has doubled again since the start of 2021. Clearly, BlockFi has earned users’ trust.

A new phase of crypto custody for a new asset class

As early holdings continue to grow and new users, both consumer and institutional, come into the market, we believe users will seek more traditional financial services for their crypto (borrowing, lending, private client services, a credit card, a phone number to reach if you have questions, etc.). Particularly given the wealth creation around Bitcoin and near-religious belief that it’s going “to-the-moon”, many users are increasingly interested in borrowing against their holdings to finance more traditional asset purchases such as homes, stocks, or bonds. 

Today, users are required to build bespoke relationships with OTC desks to lend or borrow against their crypto holdings, or engage with decentralized finance protocols, which requires a migration to Ethereum and some degree of technical comfort. The market needs a First Republic of crypto—a high-service institution that can be trusted with deposits and provide financial services.

Enter BlockFi

BlockFi is the new financial services platform for the crypto age; its easy-to-use, trusted platform brings cryptocurrency to the mainstream. Zac and his team have built an incredible business providing sophisticated, best-in-class financial services for crypto-holders. Bain Capital and some of our partners have been using BlockFi’s interest deposit account and institutional capital lines for some time. We’ve been impressed with the team, their current product offering and ambitious roadmap, their future vision, and the operational rigor that BlockFi has brought to a somewhat esoteric asset class. As crypto goes mainstream, we are convinced BlockFi will be one of the enduring financial services infrastructure components. 

In this next chapter, we’re excited to support BlockFi in scaling its customer base, releasing a suite of new products, and continuing to provide a high-quality service to new and existing customers. As crypto becomes as large as the global financial system, the market opportunity for BlockFi is near limitless.