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BitFury logo.

BitFury logo.

San Francisco-based bitcoin mining hardware maker BitFury announced today that it had secured a new round of financing worth $20 million dollars. Investors in the new round included Binary Financial, Crypto Currency Partners, Georgian Co-Investment Fund (GCF), Queensbridge Venture Partners and ZAD Investment Company. Angel investors Bill Tai and Jonathan Teo were also involved in the deal, which may signal a new focus on bitcoin venture capital on the bitcoin network itself. BitFury received a $5 million round of seed funding earlier this year.

While bitcoin payment service startups have received over $100 million in venture capital in the last six months, bitcoin infrastructure providers have generally been left out in the cold for the last two quarters. With rapidly rising difficulty rates for mining bitcoin and seemingly endless delays from chipmaking partners in Asia cutting into profits, the investment world seemed to be taking a “wait and see” approach to the industry. With a new generation of high-power, low-energy consumption ASIC miners on the horizon, however, that attitude may be about to change.

According to the press release, BitFury will use the funds largely to expand its existing operations.

Bitfury will use the proceeds from this financing to build out its facilities in strategic international locations, accelerate its production of the next generation of bespoke semiconductors, or ASICs (Application Specific Integrated Circuits) and servers, and develop opportunities in adjacent business areas.”

It’s not surprising that BitFury was able to secure such a large investment. It currently operates the single largest bitcoin mining pool, Ghash.io, with 32% of the entire network’s hashing power. The company recently announced plans to expand operations in Europe, and is slated to open a new facility outside Amsterdam later this year. BitFury chips form the centerpiece of the HexFury ASIC USB stick, which may help to revitalize the ailing hobbyist mining niche. The company’s new BF3500 miner claims to run at 3.5TH/s, putting it neck-and-neck with the most powerful hardware on the market.

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