Blockstream has raised $125 million in funding and is planning to expand its Bitcoin mining services.
The funding round was led by Kingsway Capital, with participation from other investors. The list includes Fulgur Ventures and Cohen & Company Capital Markets served as the exclusive financial advisors for the round.
According to multiple sources, the funding will be used to expand Blockstream's Bitcoin (BTC) mining facilities in order to meet the strong demand for its institutional hosting services.
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This funding round followed Blockstream's $210 million Series B capital raise in August 2021. It was used to build several enterprise-class mining facilities with the capacity for institutional hosting customers.
The company also used the funding to strengthen its vertical integration with the acquisition of Spondoolies. The acquired company designs and manufactures ASICs and enterprise miners.
Additionally, with the new funds, the company plans to expand its renewable energy mining products and continue developing its own Bitcoin miner, which is the first institutional-grade Bitcoin miner.
The President and CFO of Blockstream, Erik Svenson, stated:
This fundraise allows us to accelerate the year-over-year revenue growth we created with our 2021 Series B and continue to build infrastructure for the future Bitcoin economy.
This fundraising round by Blockstream comes at a time when the Bitcoin mining industry has been struggling. After FTX's collapse, many of the top players are struggling to stay afloat.
The value of Bitcoin (BTC) has a direct impact on the revenues available to miners, as a decrease in Bitcoin's market value results in a decrease in dollar-denominated revenues.
However, with Bitcoin's recent pump to almost $23,000, the average miner is once again able to operate at a profit.