Blockstream Unveils New Investment Funds Amidst Crypto Lending Landscape
Blockstream, a prominent Bitcoin development firm co-founded by the influential Bitcoin developer Adam Back, has announced the launch of three new investment funds, with a particular emphasis on crypto lending. This strategic move comes at a time when the crypto lending sector is navigating through turbulent waters following the dramatic collapse of major players like FTX.
The first fund is designed to underwrite Bitcoin-backed loans, providing an avenue for users to leverage their Bitcoin holdings. The second fund will facilitate crypto borrowing, allowing users to secure loans using U.S. dollars as collateral. In addition to these lending-focused funds, Blockstream will also introduce a third fund that aims to implement sophisticated hedge fund strategies, catering to a diverse range of investors.
According to a recent report by Bloomberg, which cited unnamed sources, Blockstream has successfully secured several billion dollars in funding to support the launch of these innovative funds. This substantial backing underscores the firm’s confidence in the potential for growth within the crypto lending market, despite recent challenges.
The crypto lending industry has faced significant setbacks, particularly after the implosion of FTX, which was marred by falsified balance sheets and an inability to meet its financial obligations. This crisis led to the downfall of several once-reputable crypto lenders, highlighting the need for more transparent and sustainable lending practices.
Blockstream’s three funds are slated to go live in April, with plans to begin accepting additional external capital starting in July. Notably, both lending funds will be accessible for borrowing, aiming to provide a much-needed lifeline to investors and borrowers in the current market.
In tandem with this initiative, Blockstream has recently expanded its global footprint by opening a new office in Tokyo. This move is part of their broader strategy to drive the adoption of Bitcoin Layer-2 solutions, promote self-custody technologies, and facilitate the tokenization of real-world assets (RWA) in the Japanese market. With these efforts, Blockstream aims to reinforce its position as a leader in the evolving landscape of cryptocurrency and blockchain technology.
