Bitcoin's price may be drifting sideways, but Unchained, a company focused on providing Bitcoin-only financial services, says it is growing and raising $60 million in a Series B funding round.
The round's initial close, completed last week, was led by Valor Equity Partners, Unchained said Tuesday. Other investors in the first close include NYDIG, Trammell Venture Partners, Ecliptic Capital and Highland Capital Partners.
Unchained declined to comment on the size of the initial close, but a person with direct knowledge of the matter told The Block that it was worth around $30 million and that a further $20 million has already been committed. Unchained declined to comment on valuation with the latest round.
The Series B round, when completed, will bring Unchained's total funding to date to $115 million. The company today also revealed that it has raised $15 million in a Series A extension round led by Ten31, completed last fall.
Unchained's bitcoin focus
Founded in 2016, the Austin, Texas-based company provides retail and institutional clients bitcoin custody, lending and trading services.
Unchained says its "collaborative" custody model, which provides benefits of self-custody with the company's support in case clients lose one of their private keys, has helped its business grow in the last few months that saw collapses of centralized crypto platforms such as FTX and BlockFi.
"Unchained is in a remarkable position while many other lenders and financial services providers in the space have gone bankrupt," Unchained CEO Joe Kelly told The Block. "We have a strong market position from which we can grow our brand and client base with a proven track record and safe custody model."
Kelly went on to say that the recent crypto failures have helped Unchained gain new clients, even though the company saw its trading volumes and loan demand decline along with the rest of the industry.
As for how Unchained experienced "zero loan losses," Kelly said the company has always lent at a low loan-to-value (LTV) ratio "of 40-50% and never rehypothecate client assets," which ensures "the collateral is always there to cover loans and our borrowers are comfortable with meeting their margin calls."
With fresh capital in hand, Unchained plans to launch new products and services, including checking accounts and mobile applications.
"We believe there's a bitcoiner born every minute — they just don't know it yet," Kelly said. "Staying true to our roots in bitcoin and technology, we look forward to continuing to attract both new and experienced bitcoiners, as we accelerate the arrival of a future based on sound money and self-custody."
Unchained is also looking to expand its current team of 85 by hiring 5-10 people per quarter through this year, according to Kelly.
Last November, the company laid off about 15% of its employees.
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