2014 Venture capital investment into bitcoin

This year, digital currency’s start-ups have already started seeing huge venture capital investments. As of June 2014, the amount of venture capital raised by the bitcoin startups beat the total amount raised in 2013 by a staggering $27 million.

More money going into bitcoin in 2014 than internet startups in 1995

Bitcoin has received a total of $252.17 million dollars till date, with a major portion of worth $158.23 coming in 2014. Going by this rate, the start-ups are expected to receive a total of $284.5 million in investments by the end of 2014.

The investments which started pouring in during 2012, totaled a mere $2.1 million, but jumped manifold to approximately $92 million in 2013. The trend of investing in the digital currency is picking up fast, with some of the major brands appreciating the crypto-revolution.

The exuberance bears a strong resemblance to the huge enthusiasm that the Internet revolution generated in 1995. The venture capital deals in 1995 (excluding the late-stage investments) were worth $250.1 million but the euphoric bitcoin investments looks set to belittle them and considering that internet has become indispensable to one and all after approximately 20 years, the probability of bitcoin becoming a part of everyday life cannot be ruled out.

Some of the prominent names which have managed to raise huge capital are:

  • Xapo: – The Palo Alto-based bitcoin security company has raised $40 million in 2014, which is the maximum amount for any year till this date. The prominent investors are Benchmark Capital, Greylock Partners, Index Ventures and Ribbit Capital. Xapo is essentially a wallet service which also provides cold-storage vault security.
  • BitPay: – Bitpay is a bitcoin-payment processor which enables users to accept bitcoin using a variety of website plugins. The payment processor, which has often been called the Paypal of bitcoin, has received $32.51 million in 2014 from Sir Richard Branson, Index Ventures and others. The $30 million dollars it raised in the first round of VC investments in May 2014 is the biggest venture-capital investment in the digital currency industry.
  • Circle Internet Financial: – Circle is a consumer finance company which has raised $17 million in investments from venture capitalists such as Breyer Capital, Pantera Capital, Bitcoin Opportunity Fund and others in March 2014.
  • BitFury: – Bitcoin mining hardware giant BitFury announced $20 million in new financing in May 2014. The Amsterdam-headquartered company operates one of the world’s largest bitcoin mining operations with datacenters based in Finland, Georgia and Iceland. Prominent investors included Binary Financial, ZAD Investment Company, Jonathan Teo and Bill Tai.
  • BitGo: – Multi-Sig Bitcoin wallet provider BitGo has attracted $12 million in investments in 2014 courtesy of Redpoint Ventures, Bitcoin Opportunity Corporation, Crypto Currency Partners and other A-grade investments among others.
  • OKCoin: – The Beijing-based bitcoin exchange announced $10 million in the first round of VC-backed funding in March 2014. The investment round was led by Ceyuan and followed by Mandra Capital, VenturesLab and other high-profile investors.

This is an unreal amount of money going into bitcoin startups, and if it comes to fruition anywhere near the level that the investment in 1995 into internet startups has then you better hold onto your seats!