Bitcoin, as a means of payment, is limited. People cannot use it as cash. But what if U.S. Consumers on a large scale could use Bitcoin as cash? For Uber rides or groceries? BlockFi believes a mobile banking service, with credit loans, and a rewards system will be the holy grail. They received $30 million in a Series B investment to build it.
In a press release today by BlockFi: “It has raised $30 million in Series B funding led by Valar Ventures. Other participating investors include Morgan Creek Digital, PJC, Akuna Capital, CMT Digital, Avon Ventures, Castle Island Ventures, Purple Arch Ventures, Kenetic Capital, Winklevoss Capital, Arrington XRP Capital, and Hong Kong-based HashKey Capital.”
BlockFi is a crypto lender, but they envision Bitcoin’s growth depends on US consumers investing and using crypto for everyday purchases.
Flori Marquez is a co-founder and the Vice-President of Operations for BlockFi, based in New York City. She told me growth in the U.S. market is the best way to encourage cryptocurrency as an acceptable means of payment.
“How can we make it easy for people who have never invested in crypto to try it as an alternative?” she said. For that to happen, Ms. Marquez expects to launch a mobile service in 2020 that will link bank accounts to their lending service.
While that is not unusual, other services like Coinbase or Coinmama, offer credit card purchases and linkage to bank accounts, the U.S. market has been slow to use these services commonly.
Ms. Marquez's vision is to provide credit card services, interest-based returns on assets and a rewards system as an investment in cryptocurrency to incentivize consumers.
Regulatory rules on crypto are a moving target and could change. Private enterprises, like BlockFi, are not waiting. If they can create a service that provides a commonly used bridge between digital tokens and cash, adhering to current U.S. compliance and regulatory rules, their service could help drive demand.
BlockFi’s growth has been fueled, to a large extent, by institutional investment. They manage $650M in assets.
Ms. Marquez explained that their attention to mainstream investors is their future focus to continue growth. “For most people, cryptocurrencies are something out of speculative fiction. Adoption of these assets is limited by the average consumer’s ability to understand how to use them,” said Ms. Marquez. “We have demonstrated that we can build financial products around cryptocurrency that can look and feel like the apps you already have on your phone, and we’re well-positioned to drive mainstream adoption.”
