Chinese cryptocurrency lending startup Babel Finance said it has reached a record of $380 million in outstanding loans as of February.

Flex Yang, co-founder of Babel Finance, said on Thursday the firm’s outstanding loans have grown from $52 million worth of USDT as of Q1 2019 to $289 million as of the end of last year, reflecting the increasing market demand in the crypto lending business amid bitcoin’s price surge since April last year.

The firm, incorporated in Hong Kong late 2018 with a main operation in Beijing, has recently closed a Pre-A funding round with investment from Dragonfly Capital and Parallel Ventures, a crypto-focused spinoff of Chinese VC FreesFund.

Yang declined to disclose the exact investment amount but said the valuation was between $50 million to $100 million. The firm is looking to conduct another round of financing within the first half of this year with a target to raise another $10-20 million that would value itself at $100 million to $200 million.

“The purpose of the fund raise is to help us expand the network of our overseas partners since our cashflow and reserve ratio are healthy at the moment,” Yang said via a phone call.

According to him, 70 percent of the capital Babel used to originate its loans has come from crypto-interbank lenders. Among them, Yang said, the U.S.-based Genesis Capital and BlockFi are two major partners.

Meanwhile, as of Dec. 31, the firm also had about $40 million worth of USDT as outstanding loans made to other crypto lending institutions.

Miners' push

According to Babel’s 2019 annual report, the demand from Chinese crypto miners led to the first round of growth for the firm’s lending business as bitcoin’s price dropped below $4,000 in early 2019.

Out of the $52 million in outstanding loans Babel originated as of Q1 2019, $33.9 million-worth of USDT was lent to crypto miners, accounting for over 60 percent of the total amount.

CoinDesk reported at the time that Chinese crypto miners had turned to investment and capital firms in China to borrow digital assets to either pay for utility costs or stock up mining equipment while pledging their mined cryptocurrencies as collaterals. The strategy was not to sell their mined coins at a bearish market.

While the loans made to crypto miners have steadily gone up throughout 2019, their weight over the total outstanding amount decreased to 17 percent as of Q4 2019. Meanwhile, the demand from institutional investors and hedge funds have increased amid the crypto market’s bull run since April last year.

Yang said the loans originated for institutional traders jumped to $131 million as of Dec. 31, accounting for nearly half of the total loans outstanding at the time.