Crypto investment provider NYDIG raised an additional $100 million in growth capital earlier this week. The new funding round featured MassMutual, Stone Ridge Holdings, New York Life, and Liberty Mutual Insurance, among others as strategic partners. This follows the investment firm’s $200 million cash injection back in early March.
In the previous funding round, Robert Gutmann, CEO of NYDIG, stated that the additional funds would be used to develop “Bitcoin-related strategic initiatives spanning from investment management, insurance, banking, clean energy, and philanthropy.” With recent funding and strategic hires, Gutmann promised to deliver an “explosion of innovation in Bitcoin products and services.”
How Potential Inflation has led to NYDIG’s Growth
Ross Stevens, CEO of Stone Ridge and Executive Chairman of NYDIG, continued, “Fiat depreciation causes inflation in fiat premiums, while collapsing the purchasing power of claims. We see a brighter bitcoin-powered future for the billions who depend on the insurance industry every year.” More simply put, high inflation erodes the current value of fixed-rate future payments — which is an obvious detriment of insurance companies. Using Bitcoin over fiat, insurers can indirectly “hedge” against inflation.
Growing institutional demand for cryptocurrencies has led to NYDIG nearing $6 billion in assets under management. The firm partnered with Morgan Stanley’s private wealth management arm to offer Bitcoin investments to wealthy clients.
The New-York based firm also announced that Mike Sapnar, CEO of major insurance company TransRe, would join the company as the global head of insurance solutions, assisting the firm in paving the way for “Bitcoin-driven innovation” in the property and casualty industry.
“With the addition of Mike Sapnar, a trusted partner for years, and now with Starr, Liberty Mutual, New York Life, and MassMutual as shareholders of NYDIG, we will be working tirelessly to enable new Bitcoin-denominated products for global insureds,” Stevens said.
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