Blockchain company Blockdaemon has raised $ 28 million. The Series A funding round was spearheaded by venture capital firm Greenspring Associates. Investment bank Goldman Sachs invested $ 5 million and joined Blockdaemon as an observer on the board of directors.
The funding round also included BlockFi, Voyager Digital, Uphold and the company’s long-term investors – CoinShares, Borderless Capital and Blockchain.com Ventures.
Blockdaemon will use the raised funds to increase the headcount to 100 people by the end of 2021. Thus, the project representatives intend to use the funds to expand the staff. Including, representatives of Blockdaemon intend to hire more engineers.
The startup was launched in 2017. The Blockdaemon team is developing solutions for cryptocurrency staking and node management infrastructure.
According to the founder and CEO of Blockdaemon, Konstantin Richter, today the company serves over 100 institutional clients. Including cryptocurrency and traditional financial companies. Indeed, the company has seen rapid growth in the past year and has won clients including JPMorgan Chase & Co. and Citigroup Inc. Through its staking infrastructure, Blockdaemon allows end users to generate income from their coins.
The company has deployed over 10,000 nodes across 40 blockchains.
Richter added that Blockdaemon’s current total funding for Series A is about $ 40 million. He declined to comment on the firm’s valuation. But he noted that the company is selling ten times more than a year ago.
According to Richter, Blockdaemon had net income of $ 18 million in the first quarter and revenues of about $ 24 million. Companies such as PayPal Holdings Inc., Robinhood Markets Inc. and E * Trade, have turned to their services to expand their blockchain and cryptocurrency offerings.
Other investments by Goldman Sachs
As a reminder, in early May Goldman Sachs led a $ 15 million Series B funding round for analyst firm Coin Metrics.
Also last month, Coinbase Global Inc., the largest US cryptocurrency exchange, went public through a direct listing on the Nasdaq. Blockdaemon CEO Richter said he has noticed progress among large financial companies starting with allowing their clients to buy bitcoin and ether. They then move on to protocols that pay interest if you have enough tokens to secure the network.
“Large organizations are serious about paying profits to their customers”, he said. “This shows that large financial institutions will eventually want to compete with Coinbase by copying its model to make it easier to buy and earn interest on various digital coins”.
Goldman Sachs seems to agree with his opinion. So, Goldman Sachs analyst Will Nance said that investing in Coinbase shares is the best way to gain access to the cryptocurrency market and avoid its volatility after the recent crypto downturn.