Scoop: The Block hunts for cash following funding scandal

• Its research business, once considered one of the strongest in the industry, has taken a hit as other competitors have started to build out similar services.

Catch up quick: In late 2022, Axios reported that The Block's former CEO had been secretly funding the company with cash funneled from the disgraced Sam Bankman-Fried's cryptocurrency trading firm.

• The scandal led to the departures of several of its senior staffers and a round of layoffs that accompanied a leadership shake-up following the controversy.
• The company sold a majority stake to Foresight Ventures in 2023. The deal, which valued the crypto outlet at $70 million, freed the company from its financial tie to the FTX scandal.
• The vast majority of the capital raised from the sale was used by The Block to buy out its former CEO's stake.

State of play: The company began talking to potential investors last fall, sources told Axios.

• It was looking to raise $10 million–$15 million, beginning with an initial $2.5 million capital injection into its existing businesses, such as its custom data dashboards business.
• Central to The Block's investor pitch is its plan to build and grow a slew of new and existing ventures that could offset post-scandal hits to its existing research, subscription and advertising businesses.
• Those ventures include Campus (The Block's digital asset certification program designed to rival a certified financial analyst), a mobile app, and the build-out of a community development network.

Zoom in: Its growth plans explicitly highlight efforts to expand its newsroom, which included 10 reporters as of last fall, according to a source familiar with The Block's plans.

• The Block's sponsorship and advertising revenue today makes up a significant chunk of its business and is mostly tied to its editorial products, including events, which the company plans to expand on.

What they're saying: "The Block is always interested in speaking with potential strategic partners to help expand our research, data and information services," a spokesperson for The Block said.

• "2025 is shaping up to be one of our strongest years yet, with Q1 revenues projected to double compared to Q4, as companies in the crypto sector prepare for significant headcount expansion and require the right tools to support their hiring efforts."

By the numbers: In 2022, The Block earned $18.7 million in overall revenue, with $8.7 million coming from subscriptions, $6.5 million coming from advertising and $3.4 million coming from research.

• In 2023, the year after Axios reported about the SBF funding scandal, The Block earned just $8 million in overall revenue, with $2.7 million coming from advertising, $4 million coming from subscriptions and $1.3 million coming from research.
• Last year, it projected earning $11.4 in top-line revenue, although it's unclear whether it hit that goal. Investors pitched on the fundraising opportunity last fall were told the company had at that point only earned $7.4 million in top-line revenue.
• Prior to the scandal, The Block employed 135 people. In mid-2024, it employed 61 people.

The big picture: The crypto news industry has been plagued by broader challenges related to the murkiness of the crypto market and the small number of players that control the ecosystem's funding.

• Last month, three editors at the crypto news site CoinDesk were let go amid what was labeled a restructuring.
• CoinDesk, which gained notoriety for chronicling the downfall of FTX and Alameda Research, struggled when its former parent, Digital Currency Group, was hit by a downturn in the crypto markets. It was eventually sold to Bullish, a crypto exchange.
• The recent restructuring appears to be tied to Bullish's frustrations with a CoinDesk article written about Justin Sun, the founder of the Tron blockchain.