Crypto infrastructure startup Function, formerly known as Ignition, has successfully raised $10 million in a seed funding round aimed at transforming how institutions earn yield on Bitcoin.
The round was led by Galaxy Digital, the crypto investment firm founded by Mike Novogratz, with additional backing from Antalpha and Mantle.
Function’s focus lies in bridging the gap between traditional finance and decentralized finance (DeFi).
They aim to offer tools that allow institutional investors and corporate treasuries to generate yield from their Bitcoin holdings, without giving up custody or compromising on risk management.
FBTC: Function’s Flagship Bitcoin Yield Product
Function’s core innovation is FBTC, a fully reserved, composable, and 1:1 asset-backed representation of Bitcoin designed for institutional use.
The platform already boasts $1.5 billion in total value locked (TVL), signaling strong early adoption.
Unlike wrapped Bitcoin models that require relinquishing custody to third parties, FBTC enables institutions to retain full custodial control while deploying Bitcoin productively across DeFi protocols.
The approach ensures both compliance and flexibility, two critical requirements for institutional participation in crypto markets.
Galaxy Digital’s Strategic Role Strengthens Function’s Trajectory
The involvement of Galaxy Digital in the seed round goes beyond capital.
Galaxy will act as a core contributor, supporting FBTC through liquidity provisioning, governance design, and risk framework development.
With Galaxy’s deep expertise and infrastructure, Function is expected to rapidly scale FBTC’s institutional reach.
According to Function CEO Thomas Chen, the partnership reflects a broader market shift: “By 2026, treating Bitcoin as a passive treasury asset may no longer be enough. The new standard will be actively earning yield.”
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Function Positioned to Lead the Next Era of Bitcoin Utility
Function is entering the market at a pivotal moment when institutional interest in Bitcoin is maturing beyond simple holding strategies.
As macroeconomic conditions drive more institutions to explore crypto yields, products like FBTC offer a pathway to generate yield without compromising security or compliance.
Chen added that Function aims to evolve from “wrapped assets to functional infrastructure,” helping Bitcoin transition into a truly productive and programmable asset class.
The vision directly addresses a long-standing issue: Bitcoin’s massive market cap but minimal utility in DeFi relative to other assets.
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Rising Trend in Crypto Seed Funding for Infrastructure and Utility
Function’s successful raise follows a broader trend of early-stage funding targeting infrastructure projects in crypto, particularly those enhancing utility and efficiency.
Projects like Sphinx Protocol, which raised $2 million to power a new energy-efficient trading exchange in June.
Also in June, SaturnX, which secured $3 million to expand stablecoin remittances in emerging markets, are reshaping how assets move across blockchains.
Additionally, Ubyx, a stablecoin clearing startup, raised $10 million from Galaxy Ventures and Coinbase to build links between banks and stablecoin issuers.
These developments highlight a growing institutional appetite for crypto solutions that blend compliance, utility, and yield generation, an ecosystem where Function’s FBTC is poised to play a leading role.
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