In a piece of recent news, lenders in the crypto industry have been found to make some quick money, with the crypto market going bull, at the start of 2019.
As per confirmed news from Bloomberg, creditors who primarily lend in the cryptocurrency industry, have found a lot of borrowers off late who want to take up more for further investments and do not want to throw away their possessions at a less price. Even the big investment companies are not far behind, showing a lot of promises when it comes to borrowing coins for quick selling.
As per the report from Bloomberg, BlockFi which is primarily a crypto lending company has seen revenue to grow at an exorbitant rate at a 10x ratio since mid of last year after Galaxy Digital Ventures which is owned by Michael Novogratz agreed to invest around $52.5 million in this company. Michael Novogratz is an ex-hedge fund manager of the Fortress Investment Group and a longstanding advocate of cryptocurrency. Michael Novogratz’s Bitcoin involvement started when he bought cryptocurrency for the first time before his retirement from Fortress and subsequently becoming the CEO of Galaxy Investment Partners — a cryptocurrency investment firm. In 2012, Michael Novogratz’s net worth was about $500 million.
Primarily, BlockFi provides funds to global clients who hold cryptocurrencies and are ready to mortgage them in return for quick funds. Zac Prince who is the current CEO of BlockFi stated in an interview that it is always a safe investment in these firms as these firms have never seen the loss of principal in the past year.
Similarly, as per Michael Moro, the CEO of Genesis Capital, a lending company that provides borrowers crypto in return for dollars, said in a press interview that the ongoing bear market has definitely boosted the economy resulting in a sudden growth. As per news from last October, Genesis did transactions of almost $550 million during the first two-quarters of its operation. Seeing the current trend in the bull market, Genesis is really aggressive to invest further $700 million in disbursements and loans. In the current market, Genesis has around $140 million in outstanding loans with a payback duration of two months.
While most of the Crypto companies have been planning to cut short their man forces due to inconsistent and volatile market condition, Genesis has been looking forward to hiring and has nearly doubled the current staff due to its ever-increasing incoming projects. It has even plans of moving to Asia as its looking forward to expanding. In an interview, Boro claimed that the Genesis has been making profits from the very first day of its inception. There is certainly a market demand, and Genesis’s products have fitted really well with the market needs and its time that they really get to big-time investments generating huge revenue.
But this situation has not been the same everywhere. During the last crypto crash in Nov’18, Steemit which is a social media platform-based company had to cut short its man force by almost 70% eventually leading to structural reorganization. Due to a sudden drop in the market, there was a fall in fiat currency returns from token sales which is STEEM’s automated system. Other mining giants like Bitmain and Huobi have also shared their plan of layoff due to volatile market conditions. Bitmain Technologies Limited is a privately-owned Chinese company, founded by Jihan Wu and Micree Zhan. Bitmain is also an operator of Antpool, one of the largest Bitcoin mining pools. Bitmain has offices in China, the US, Israel, the Netherlands, and Switzerland.
Similarly, Huobi is a Chinese web-platform for cryptocurrency exchange and the second largest in the country. Leon Li founded it in 2013. All popular fiat and cryptocurrencies are available, but the main pair here is BTC/CNY. The average amount of trading per day reaches 127,000 BTC, which makes the Huobi exchange the third largest in the crypto industry.