Cryptoexchange Blockchain.com is reportedly on the hunt for funding, but may have to cop a significant downround as a result of the bear market.
Blockchain.com, which doubles as a financial services firm across the crypto space, is in talks for a round that could take its valuation to between $3 billion and $4 billion, Bloomberg reported on Thursday.
That would be 70% lower than its $14 billion valuation in March, when the firm closed a Series D round led by Lightspeed Capital Ventures for an undisclosed amount. Founded in 2011, the firm has raised a total of $490 million over seven fundraising rounds, Crunchbase data shows.
The move comes after Blockchain.com reportedly raised a strategic funding round, again of an undisclosed amount, led by UK-based investment firm Kingsway Capital in the third quarter. Terms of the latest deal are still developing and not final yet.
Blockchain.com was one of several major players in the space to lay off employees during tough market conditions, slashing 25% of its workforce in July. Around six weeks earlier, Peter Smith, Blockchain.com CEO, told Blockworks the crypto ecosystem was entering the “despair” phase of the bear market.
The firm was also reportedly exposed to embattled crypto hedge fund Three Arrows Capital, which owes it $270 million as of its July insolvency.
All this while venture capital (VC) funding for the crypto sector has slowed dramatically, as the prices for bitcoin and other cryptoassets plunged amidst a broader market downturn throughout the year.
VC firms around the world invested just $4.44 billion in crypto startups in the third quarter, a 37% year-on-year drop, Bloomberg said, citing PitchBook data.
The flagship crypto fund for Andreessen Horowitz, one of the most prominent VCs in the space, lost around 40% of its value in the first six months of this year. For scale, the total digital asset market shed 60% across the same period.
Blockchain.com didn’t return Blockworks’ request for comment by press time.
