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According to a report by The Block, crypto lender BlockFi is expected to conclude a fundraising round at a lower valuation than its prior rounds.
- According to the article, which cites persons familiar with the situation, the round will value the New Jersey-based corporation at $1 billion.
-A "down round" of financing happens when a firm wants to obtain fresh cash but learns that its valuation has dropped from the prior round.
- In March of last year, BlockFi received $350 million at a $3 billion value. It was apparently planning to raise another $500 million in late July, valuing the company at about $5 billion, as well as announcing intentions to go public.
-The reduced price reflects the current difficult environment in the crypto business, as well as regulatory concerns surrounding firms like BlockFi, which pays high interest on crypto assets.
- In February, the company agreed to pay the Securities and Exchange Commission (SEC) and various state authorities a total of $100 million in fines as part of a settlement in an investigation into whether its high-yield loan product was a securities offering.
- At the time of publication, BlockFi had not replied to CoinDesk's request for comment on its current financing round.
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