Blockstream Secures Multi-Billion Dollar Investment for Three New Institutional Crypto Funds

Blockstream, a leading Bitcoin development firm, has secured a multi-billion dollar investment to launch three new institutional funds, marking a significant expansion of its asset management business. The funds, set to go live on April 1, will offer a range of services to institutional investors, including Bitcoin-backed lending and USD-collateralized borrowing.

The first two funds will focus on crypto lending, enabling investors to use their Bitcoin as collateral for loans or unlock liquidity from their Bitcoin holdings without selling them. This provides a way for Bitcoin holders to access liquidity without having to sell their assets, which could be particularly useful for those who want to maintain their Bitcoin positions while accessing cash.

The third fund will deploy hedge fund strategies, offering institutional-grade exposure to Bitcoin markets through various investment approaches. This adds to Blockstream’s existing investment products launched earlier this year, including the Blockstream Income Fund and the Blockstream Alpha Fund.

Blockstream’s move into the crypto lending space comes with the backing of major financial resources, which could help restore confidence in crypto lending among institutional investors who have been cautious following previous market failures, such as the collapse of crypto exchange FTX.

In addition to launching these new funds, Blockstream is expanding its operations globally. The company recently opened a new office in Tokyo, Japan, aiming to drive adoption of Bitcoin Layer-2 technologies and self-custody solutions in the Japanese market. Blockstream is also working on real-world asset tokenization in Japan, putting traditional assets like real estate or securities on a blockchain to make them more easily tradable and accessible.

Blockstream joins other major companies in the crypto investment space, such as Grayscale, Pantera, Galaxy Digital, and Crypto.com, which already offer crypto-focused investment funds with various levels of market exposure. The company’s co-founder, Adam Back, has been outspoken about maintaining Bitcoin’s role as the primary cryptocurrency and has criticized plans for a strategic crypto reserve that would include cryptocurrencies besides Bitcoin.

The two lending funds from Blockstream will be available for borrowing once they launch, creating new options for institutional investors looking to participate in the Bitcoin economy while managing their assets strategically.