The merchant bank belonging to billionaire and Bitcoin bull Mike Novogratz, Galaxy, has led a $52.5 million dollar fundraising round for New York-based crypto-lender BlockFi.

BlockFi allows investors to borrow as much as $10 million dollars in fiat currencies against their balances of Bitcoin or Ethereum. The crypto-holdings act as collateral and are kept in the ownership of the borrower. The borrower can still take advantage of cryptocurrency price surges and keep hold of their gains, whilst freeing up fiat capital for other ventures.

BlockFi, founded in 2017 by Zac Prince, also raised $1.55 million from ConsenSys Ventures, SoFi, and Kenetic Capital in February 2018. The new round of funding will propel BlockFi’s expansion across the U.S. and into international markets. It will also allow the company to add more products and investigate the addition of new cryptocurrencies as collateral options for borrowers.

In an interview with Business Insider, Prince revealed that BlockFi could look to offer fixed-income and debt investments, other lines of credit, and potentially a credit card.

“A robust lending market is the keystone for financial systems and BlockFi’s institutional approach and deep lending expertise were key drivers in our decision to partner with them,” said Novogratz.

Novogratz was estimated to have a personal fortune of $2.3 billion prior to 2015. He gained at least $250 million dollars investing in Ethereum in 2017 and now has an estimated 10% of his entire wealth invested in cryptocurrencies. He raised $250 million dollars in 2018 to launch Galaxy, which trades in cryptocurrency assets and makes investments into viable blockchain companies.

The billionaire is also known to have backed EOS, and Galaxy has invested $35 million into virtual-reality firm High Fidelity and $15 millon in AlphaPoint. According to the report by Business Insider, citing sources familiar, Galaxy also has a “significant portfolio of early stage ventures.”

Novogratz, in an interview this week with TheStreet, has predicted that venture capitalists and institutional investors are increasingly looking to make blockchain and cryptocurrency investments. This sentiment was also echoed very recently by Peter Smith, CEO of Blockchain Ltd.

“I think institutional investors are slowly coming to the realization that blockchain will be Internet or Web 3.0 and they’ll want to participate just like they want to participate in the Web,” said Novogratz. He predicts these high-level investors will start with venture-capital funds, as many already are, then progress to buying coins and investing in ICOs. Ever a proponent for cryptocurrency, he also said this week he feels that bitcoin has finally bottomed.

As one of the biggest backers of EOS, Novogratz explained its strengths:

“The EOS blockchain will be much, much, much faster than the other blockchains. It’s already doing 5,000 transactions a second. It should be doing 50,000 transactions per second in a few months.”

The post Mike Novogratz Leads $50 Million Dollar Investment in Crypto-Lending Startup BlockFi appeared first on UNHASHED.

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