Blockchain technology provider Alchemy has raised $80 million in its Series B funding round, raising its valuation to $500 million.

Alchemy will use the cash injection to expand its developer tools to other blockchains besides Ethereum (ETH). It also plans to strengthen its presence in New York and California, as well as expand to Europe and Asia.

The funding was led by Coatue Management and Addition LP. It also included DFJ Venture Capital, soccer club Manchester United owners the Glazer family, and the rock band the Chainsmokers.

Increased blockchain investment

This investment is just the latest in a year filled with high value fundings. According to CB Insights, 156 startups focusing on digital technology have raised $3.1 billion so far this year. This contrasts with the 341 deals that drew $2.3 billion in funding for the whole of 2020. 

“It really highlights the power of blockchain and the whole industry and how blockchain has become more mainstream,” said Alchemy co-founder and CEO Nikil Viswanathan.

Blockchain agnostic

Alchemy was founded in 2017, limiting itself to select clients. However, since opening to the public in August 2020, it now powers 70% of the top applications on Ethereum. These include NFT platforms such as OpenSea, Nifty Gateway, SuperRare, and Makersplace. It also facilitates decentralized finance (DeFi) projects.

As part of the funding, Alchemy aims to expand its services to other blockchains as well. Alchemy calls itself “blockchain agnostic,” wanting to help as many distributed computer networks as possible, said Alchemy co-founder Joe Lau.

For instance, it plans to expand its tools to Flow, which powers the popular NBA Top Shots NFT collection. “Investors see us as a bet on the blockchain industry as a whole,” Lau said.

Lead independent director at Morgan Stanley Tom Glocer noted that he invested in Alchemy because of their “systemic themes.” He found their foundational approach appealing. “I couldn’t tell you if bitcoin (BTC) was going to go up or down or if I should buy ether (ETH),” Glocer said, “I want to invest in the picks and shovels.”

He says the scaling up will be a challenge for the 20 employee company. “They need to scale up the company to handle the level of incoming,” Glocer said.