Blockchain technology firm Blockstream has expanded its capital-raising efforts, securing $210 million in financing through a convertible notes round led by Fulgur Ventures.
According to an Oct. 15 announcement, the debt will support Blockstream’s ongoing Bitcoin infrastructure projects, including its layer-2 strategy, mining operations and financial products development.
Among Blockstream’s flagship products is the Liquid Network, a Bitcoin sidechain launched in 2018 to provide faster transactions and asset issuances, such as stablecoins and security tokens.
According to the company, a total of over $1.8 billion in assets, including stablecoins, tokenized bonds and securities, have been issued on Liquid to date. The network currently holds over 3,844 Bitcoin (BTC) locked onchain.
Blockstream recently disclosed another fundraising initiative. In September, the company announced the second batch of its security token — Blockstream Mining Note 2 (BMN2) — backed by the Bitcoin miner’s hashrate. The token offering targeted institutional investors in Europe, providing investors “direct exposure to Bitcoin hashrate operated by Blockstream’s [...] enterprise-grade mining facilities across North America.”
The company’s first security token, Blockstream Mining Note (BMN1), issued in 2021, matured in July, delivering a “32% Bitcoin return over its 3-year term,” it said.
BMN2 locked hashprice strategy. Source: Blockstream
In 2021, Blockstream announced plans to raise $50 million through a notes offering to purchase discounted Bitcoin mining equipment during market downturns.
Bitcoin layer-2s
Layer-2 solutions for the Bitcoin network have been on the rise since the launch of the Ordinals protocol in 2023, which allowed the storage and inscription of non-fungible tokens (NFTs) directly on the Bitcoin blockchain.
The surge in transactions on the network led to a race among established companies and startups to offer scalability solutions for faster transactions and lower fees on the network.
The emerging utility of the Bitcoin network, which was shadowed by Ethereum’s utility for years, has now seized a strong foothold in the crypto industry, especially after the approval of Bitcoin exchange-traded funds in the United States.
However, the security of those second-layer networks has yet to catch up, according to market insiders.
Other layer-2 solutions for transactions on the Bitcoin blockchain include the Lightning Network, Stacks, Built on Bitcoin (BoB) and Bitlayer. According to Forbes Digital Assets, the layer-2 market cap, which includes solutions for other networks like Ethereum, is worth $19.65 billion at the time of writing.
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