Bitcoin lending platform Lava raises $17.5 million, launches new yield product

Lava, a platform for bitcoin-backed loans, has raised $17.5 million in a Series A extension round and launched a new yield product for dollar lenders.

The round was backed by angel investors, including Peter Jurdjevic of Qatar Investment Authority, Bijan Tehrani of Stake, Zach White of 8VC, Saurabh Gupta of DST Global, Terry Angelos, formerly of Visa, and Aaron Suplizo, formerly of Block. Lava’s earlier $10 million Series A, announced last December, was co-led by Peter Thiel’s Founders Fund and Khosla Ventures.

With those investors already in place, Lava CEO Shehzan Maredia told The Block the extension round targeted strategic individuals. Maredia did not disclose valuation or deal structure; its prior Series A was an all-equity round.

Lava's new product allows users to earn yield on their USD by supplying dollars to fund bitcoin-backed loans on the platform. Borrowers post bitcoin worth more than double the loan amount, and their interest payments generate yield for dollar lenders. The product is currently offering up to 7.5% annual percentage yield. "None of Lava’s lenders have ever taken any losses," Maredia said, adding that collateral is liquidated if loan-to-value ratios deteriorate. He declined to share business metrics such as loan originations.

Maredia said Lava differentiates itself from other lending products by focusing solely on bitcoin. Competing platforms often pool collateral across multiple assets, exposing lenders to weaker tokens, or require wrapped forms of bitcoin on other blockchains, creating added custodial and protocol risks, he said.

"We believe that lending against bitcoin provides a very attractive risk-adjusted yield, but lending against other assets (or a mix of other assets) entails too much risk," Maredia said.

The dollar yield product sits alongside Lava's core offering, which lets users borrow dollars against their bitcoin without selling it, with interest rates starting at 5%. The platform also supports zero-fee bitcoin purchases, payments, and off-ramps to bank accounts, and is preparing to launch a global spend card with bitcoin cashback.

Lava generates revenue from processing fees on on-ramps and off-ramps. The firm has a 15–20 person team and is hiring selectively. The new capital will be used to scale both its lending and yield products, Maredia said.

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