Blockstream is set to launch institutional-grade Bitcoin lending funds.
Much has changed for the crypto space in the past year. From rising prices to White House support under the Trump administration, the industry appears to be gradually erasing the scars left by the Terra and FTX implosions.
Perhaps one of the biggest proofs of this is that centralized crypto lending is making a comeback. In the latest example, renowned Bitcoin technology company Blockstream looks set to offer Bitcoin lending services, following similar moves from Coinbase and reported plans by Tether.
Blockstream Bitcoin Lending Funds Set to Launch
Blockstream is set to offer crypto lending services to allow institutions to secure liquidity without having to dump their crypto holdings.
On Tuesday, March 4, the firm disclosed that it would be launching three new funds on April 1, with two focused on Bitcoin lending.
Our Bitcoin-backed funds now have an official launch date.
As reported by Bloomberg, Blockstream’s institutional-grade Bitcoin investment solutions will go live on April 1, with external capital acceptance opening on July 1.
🔹 Bitcoin-backed lending – Secure institutional…
— Blockstream (@Blockstream) March 4, 2025
One fund will allow institutions to secure loans with Bitcoin collateral, while another will allow Bitcoin borrowing with USD collateral. The third fund, unrelated to borrowing, will offer institutional-grade Bitcoin exposure using hedge fund strategies.
Bloomberg was first to report the story, noting that Blockstream had secured billions of dollars in funding to launch the fund, citing anonymous sources.
Despite the valuable liquidity gap filled by crypto lending operations, centralized crypto lending platforms fell out of favor as the 2022 bear market, worsened by the Terra and FTX collapses, exposed poor risk management practices and even fraud in some instances at some leading firms.
It also did not help that, in the fallout, the Gary Gensler-led SEC started targeting crypto lenders with lawsuits alleging violations of securities laws.
But amid recovering prices, growing institutional demand, and the Trump administration’s SEC move to pause or dismiss several cryptocurrency lawsuits, the tide appears to be turning.
Blockstream’s move follows the announcement of its asset management division in January 2025.
At the time, Blockstream CEO Adam Back asserted that the expansion marked “Bitcoin’s evolution from a niche asset into a pillar of modern investment portfolios.”
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