Crypto infrastructure firm Blockstream raises $125 million to expand mining services

Bitcoin miner and hosting provider Blockstream raised $125 million in a convertible note and secured loan financing round.

The company will use the money to expand its institutional bitcoin mining colocation services at a time when others in the industry are struggling to keep afloat due to a prolonged decline in mining economics.

"Demand for Blockstream’s hosting services remains high due to the company’s strong track record and substantial scale, coupled with an industry-wide shortage of available power capacity," the company said in a statement.

Blockstream currently has over 500 megawatts in its development pipeline. Its business also extends to hardware and Layer-2 technologies like Core Lightning.

The demise of large-scale centralized parties and protocols in the past year and "resulting refocus on security and decentralization presents an opportunity for market participants to move to Bitcoin-based non-custodial architectures," CEO Adam Back said. 

The company had already raised $210 million in a series B round in 2021. In December, Bloomberg reported that it was looking for fresh funds at a significantly lower valuation than before.