The world’s largest Bitcoin-backed stablecoin issuer evaluates expanding its Bitcoin lending business into traditional financial markets.
Feb 12, 2025 – Avalon Labs is exploring the possibility of a Bitcoin-backed debt-focused public fund, assessing its potential alignment with the SEC’s Regulation A exemption. As part of this initiative, the company is assessing the regulatory framework and evaluating legal considerations with industry professionals to assess potential regulatory pathways for offering Bitcoin-backed debt products. This exploration aligns with Avalon’s broader goal of expanding its Bitcoin lending business into the U.S. market through regulated investment structures. If pursued, this approach could position Avalon Labs as an early mover in exploring regulated Bitcoin-backed financial products, potentially opening new opportunities for retail investors to access Bitcoin-backed financial instruments within a structured framework.
Regulation A is a U.S. securities exemption under the Securities Act of 1933 that allows companies to raise capital from both accredited and non-accredited investors through a public offering, without the extensive requirements of a full SEC registration. It is often referred to as a “mini-IPO”. Regulation A is widely used by fund managers, real estate investment trusts (REITs), and private companies looking to access public markets while maintaining regulatory compliance. It provides a structured framework for issuing securities to retail investors while ensuring transparency through SEC-reviewed offering circulars and periodic reporting requirements. Avalon Labs is researching how this regulatory framework could apply to Bitcoin-backed lending products. If successfully applied to crypto, this approach could create new opportunities for retail investors to access Bitcoin-denominated financial products in a regulated environment, potentially setting a precedent for the industry.
“We have spent years researching how Regulation A has been applied in traditional finance and whether it could be a viable path for crypto companies. While successful precedents in the crypto industry are limited, our analysis of previous SEC-approved cases suggests a viable path forward,” said Venus Li, Co-Founder of Avalon Labs, who previously secured SEC approval for a public debt fund in 2021. “The SEC’s role is to protect retail investors and ensure fairness, not to hinder technological progress. We are confident they will assess any future applications objectively.”
If pursued and successfully implemented, a Bitcoin-backed public fund could represent a landmark development for the crypto industry, potentially lowering entry barriers for traditional investors and accelerating the adoption of Bitcoin-backed financial products. It aligns with Avalon Labs’ broader mission to build the leading on-chain capital market for Bitcoin, transforming it from a static asset into a dynamic financial instrument.
About Avalon Labs
Avalon Labs is building the premier on-chain financial center for Bitcoin, offering a seamless ecosystem that includes BTC-backed lending, a Bitcoin-backed stablecoin, yield-generating accounts, and a credit card. We’re committed to creating a scalable, transparent, and accessible financial network that transforms Bitcoin into an active economic asset across global markets.
Avalon Media contact:
- Venus Li
- [email protected]
Disclosures: This information is for informational purposes only and does not constitute financial or investment advice. Avalon Labs provides access to decentralized financial services, but all financial decisions are solely at the user’s discretion and risk. No part of this information should be considered a recommendation or guarantee of returns. Past performance is not indicative of future results. Consult a qualified financial advisor before making investment decisions. Avalon Labs and its affiliates are not responsible for any losses incurred from using this information.