Bitcoin venture capital investment to hit $1bn this year

The falling price, negative image perception and uncertainty over regulation have all failed to reverse a strong flow of venture capital to the bitcoin sector.

According to data from Coindesk, the amount of venture capital investments, the round size raised has increased by a whopping 267 % over the last year and is set to hit $1bn this year globally.


A recent spate of big ticket deals snagged by silicon valley based company 21 Inc for $116mn and Coinbase for $75 mn had helped further boost sentiment in a sector otherwise marred by recent controversies.

Wall Street’s  blue blooded investment bank Goldman Sachs also co-invested $50 mn in a bitcoin wallet company called Circle earlier this year in what was seen as a sign from the financial services industry of lending legitimacy and prominence to the fledgling sector.

Hugh Halford-Thompson, Head of UK operations at Cointrader acknowledged that the recent trend of new deals in the start-up sign was a reflection of the optimism in the industry.

“There has certainly been an uptick in VC investments in bitcoins and I expect it to go up further towards the end of this year and next year. This is because blockchain technology is going to be used extensively within banks for their own systems and so now everyone is look at making money in this space.

The companies in the bitcoin industry broadly fall into six categories such as  exchanges, wallets, payment processors, financial services, mining, and ‘universal’, which includes companies working across multiple sectors. Exchanges and financial services however make up the bulk of the sector.

Oliver Wieland a marketing professional who met Cryptocity at a bit coin meet up recently felt that though present day challenges to mainstream adoption of bitcoin such as its price volatility and client preference for cash would continue to remain for some time now, things could look drastically different a few years down the line.

“I see myself switching jobs in a few years to join a bitcoin start-up and I have started attending bitcoin events to gear myself up for this opportunity.That is going to be the future growth area for professionals like us.”

Could this be the future?

Courtesy: Berkeley-Haas Alumni Network

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