Bitfury Raises $80 Million in Private Funding Round

Bitfury, a San Francisco-based provider of blockchain infrastructure, has raised $80 million from selected investors.

From Latvia to Dubai

The money was raised in a ‘private placement’, a fundraising campaign that involves the sale of stock to high net worth institutions such as hedge funds, banks and insurance companies.

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In this case, the money was raised from a number of investment companies. They were: Korelya Capital, of France, a subsidiary of Korean corporation Naver Group; Macquarie Capital of Australia; Dentsu Inc. of Japan; Armat Group of Luxembourg; Jabre Group of Dubai; Lian Group of Hong Kong; Argenthal Capital Partners of France; MACSF of France; iTech Capital of Latvia; and Galaxy Digital, a digital asset merchant bank from New York.

Bitfury CEO Valery Vavilov said: “The institutionalization of blockchain and cryptocurrencies, partnered with the opportunity of these emerging technologies, is a natural expansion opportunity that Bitfury will build on — in 2019 and beyond.”

The company did not mention exactly what the money will be used for – executive vice chairman George Kikvadze said that it will “position us for our next phase of growth as the market matures.” Kikvadze also said that the company is seeing “half a billion dollars” in revenue.

Mining, Lightning, Crystal

Founded in 2011, Bitfury began as a Bitcoin mining operation. It designs its own ASIC chips, and in December 2017 announced that the building of what was “probably” the largest Bitcoin mining farm in the US. It currently holds 2.17 percent of the world’s Bitcoin hashrate (1150 PH/s) according to blockchain.info, mining three blocks in the last 24 hours (of a total of 149).

Bitfury says that it is committed to using renewable energy, specifically, immersion cooling technology.

It has been working with the Lightning Network team since 2016, helping to develop the add-on that aims to make Bitcoin usable for small transactions. It successfully executed a transaction with this protocol in July 2017, and in September 2018, an internal team developed a vending machine that accepts Bitcoin via the Lightning Network.

In January 2018, it launched a protocol called ‘Crystal’ which tracks suspicious behaviour on the Bitcoin blockchain. It can be used by law enforcement to identify the real people behind Bitcoin wallets. In October, it upgraded the system to include Bitcoin Cash too.

In October 2018 it opened a base in South Korea, headed by Eun Chul Lee, who, interestingly, won a gold medal in the 1992 Barcelona Olympics in rifle shooting.