The crypto bank for ordinary holders
BlockFi launched in 2017 in Jersey City, founded by Zac Prince and Flori Marquez, with a pitch that crypto holders should be able to do the things they did with a bank. It offered the BlockFi Interest Account (BIA), which paid variable yield on deposited Bitcoin and other assets; USD loans collateralized by crypto with no credit check; and a trading desk. In July 2021 it added, with Visa, one of the first crypto rewards credit cards, paying cardholders Bitcoin back on purchases. Backed by Valar Ventures, Bain Capital Ventures, Tiger Global, Galaxy, and others, BlockFi positioned itself as a regulated-feeling on-ramp between traditional finance and digital assets.
Unicorn ascent
BlockFi scaled rapidly during the 2020-2021 bull market. In March 2021 it raised a $350 million Series D led by Bain Capital Ventures, partners of DST Global, Pomp Investments, and Tiger Global, vaulting its valuation to $3 billion. Reports later in 2021 indicated it was raising at a target valuation of roughly $5 billion. The interest-account product grew into a core driver, drawing in billions in customer crypto that BlockFi re-lent to institutional borrowers and trading firms to fund the yields it advertised, a model that depended on those counterparties staying solvent and on crypto prices holding up.