Nectar Group raises $5M seed to build HoneyB, a Bitcoin yield platform for institutions

Nectar Group, the Delaware company developing HoneyB, announced a $5 million seed round led by Portal Ventures and Peer Ventures on Oct. 21, with participation from Anchorage Digital Ventures, family offices and angel investors, according to the company announcement carried by Markets Insider. The company said it will use the money to build an orchestration layer connecting Bitcoin with institutional income strategies.

The round closed at a $30 million post-money valuation, structured as a SAFE with a one-for-one token warrant, co-founder and chief executive Josh Gordon told The Block in an interview summarized by Dealroom. No investor took a board seat, an observer role or an advisory position, the report added.

HoneyB targets institutions that already hold Bitcoin but struggle to earn on it. According to the company, earning yield on BTC today is fragmented and operationally hard: investors piece together separate custodians, lenders, asset managers, on-chain protocols and legal structures. The platform is designed to coordinate custody, credit, asset management and compliance in one dashboard, so treasury companies, exchanges, fintech platforms, family offices and other eligible institutions can reach income strategies without moving Bitcoin out of a qualified custodian or wrapping it off the Bitcoin network, per that same announcement.

"There is an enormous gap between the capital sitting in Bitcoin and the institutional income markets available through traditional finance," Gordon said in that announcement. "HoneyB is the orchestration layer between those two worlds. We are bringing fragmented pieces together so institutions can reach differentiated sources of income through one platform, without moving their Bitcoin."

The company describes three design aims for the platform. Income should come from identifiable and repeatable economic activity rather than temporary token incentives. Returns should draw on sources outside Bitcoin or broader crypto-market speculation. And the yield sources should offer scalable liquidity with defined redemption terms for institutional capital. Those aims shape which strategies the platform will list, the announcement said.

The first planned strategy combines borrowing with traditional income markets. HoneyB lets users borrow stablecoins against Bitcoin collateral, then invests the proceeds in products spanning US Treasuries, fixed income, credit, gold and options, Dealroom reported. Gordon said the underlying product targets roughly 10% annual returns, with HoneyB aiming to pass net yields of about 2% to 4% of a user's Bitcoin to that user after borrowing costs and fees. "Returns are not guaranteed," he noted. Collateral for the strategy is held through smart contracts or custody arrangements, according to Grafa's summary of the same reporting.

The company announcement frames the first institutional strategy around a fund from Simplify Asset Management, a registered investment adviser managing about $13.5 billion. The fund is managed and tokenized by Alphaledger, a US-regulated investment manager that owns a registered broker-dealer, and it draws income from US Treasuries, credit, gold, volatility risk premia and options-based income. Krisna Patel, a managing director at Simplify, said the firm is excited to partner with HoneyB and Alphaledger to bring institutional-quality income strategies to the crypto ecosystem, and described the model as combining complementary strategies designed to generate risk-managed income.

Catrina Wang, a general partner at Portal Ventures, said demand for reliable Bitcoin yield is clear, but current offerings are either institutionally gated, relatively low-yielding, or exposed to smart contract, custodial or counterparty risks, with liquidity fragmented across DeFi, CeFi, on-chain pools and off-chain funds. She described HoneyB as non-custodial, with no wrapping, and sustainable at scale.

The planned 2% to 4% net yield places HoneyB in a competitive field. Two Prime launched a lending vault in September targeting 1.5% to 2% annual returns, and Coinbase has introduced a Bitcoin yield fund targeting mid-single-digit returns, per Dealroom.

HoneyB plans to launch in the fourth quarter of 2026, initially offering the product to institutional investors outside the United States, with a US expansion and a retail product to follow, Gordon told The Block. Grafa, also citing that report, put the retail product in the first quarter of 2027. HoneyB has yet to launch, and its yields are not risk-free. Lending against Bitcoin introduces borrower, collateral, custody and liquidity risks, and actual results depend on strategy performance and loan-to-value ratios.