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Bitcoin Venture Capital Markets Heating up as Five Bitcoin Startups Raise $45 Million

Op-ed - Bitcoin Venture Capital Markets Heating up as Five Bitcoin Startups Raise $45 Million

This week, five Bitcoin startups, including Chronicled, Chain, Abra, Case and Coinalytics, have raised more than $45 million in funding from Wall Street investors and banks, Silicon Valley venture capital firms and angel investors. The recent funding rounds also showed a significant increase in corporate investors, rather than just traditional venture capitalists. These five funding announcements follow several months without any big fundraises and may signify that the bitcoin investment market is beginning to heat up again.

Chain Inc. Raises $30 Million from Visa and NASDAQ

Chain Inc., a blockchain software company, has raised $30 million from Wall Street investors and companies, including Visa Inc., Citi Ventures and NASDAQ Inc., to enable developers and financial institutions to design, deploy and operate blockchain networks to trade and transfer financial assets and smart contracts.

As an investor and a strategic partner, NASDAQ will be using the technology of Chain Inc. to facilitate unlisted companies on its private market, without the involvement of third-party startups and developers.

“We believe in the power of blockchain technology to transform how financial assets are transferred, but it has to be done with the right partners to ensure it gets off the ground,” said Adam Ludwin, CEO of Chain, in an interview with The Wall Street Journal.

Today’s banking and financial systems are extremely inefficient; it takes days to weeks to settle and process the transfer of assets or stocks, which also requires the involvement of intermediaries and regulators in its process.

The blockchain in contrast, enables instantaneous settlement of payments, transactions and assets, thus cutting a significant portion of the cost of asset trading platforms and companies. Furthermore, the integration of the blockchain technology onto today’s stock market trading platforms could rid the services of intermediaries, which account for a large portion of the costs of major stock market trading platforms such as NASDAQ.

Bitcoin Remittance App Abra Raises $12 Million

Global bitcoin remittance startup Abra has raised more than USD$12 million in a Series A funding round participated in by Arbor Ventures, RRE Ventures and First Round Capital, to further develop the iOS mobile application and to expand the reach of its services to as many countries possible before its official launch.

“[Abra] is fully leveraging the potential of the technology by reducing friction in financial services. It’s not about bitcoin for the sake of bitcoin – it’s about how the technology can solve problems for consumers worldwide, even if they don’t know what the blockchain is,” RRE Ventures general partner Jim Robinson told CoinDesk.

Abra, a remittance app launched at the Launch Festival 2015 founded by former Netscape director Bill Barhydt, aims to gather as many trusted “tellers” or users to create a bitcoin-based Western Union type of service that enables users to send and receive bitcoin quickly, anywhere in the world.

During his presentation at the festival, Barhydt explained, “Our mission with Abra is to turn every smartphone into a teller that processes withdrawals. This is not just another bitcoin app. The wallet is a full-fledged digital asset management system, and you don’t have to understand it.”

Hardware Bitcoin Wallet Manufacturer Case Raises Another $1 Million

Hardware bitcoin wallet manufacturer and developer Case has added another $1 million to their seed funding round from Future/Perfect Ventures.

Just yesterday, the Case team announced their involvement with former JPMorgan executive Blythe Masters’ bitcoin startup Digital Asset Holdings and the development of crypto-security for an interactive marketplace that uses public opinion, news, and other data to produce odds on global event outcomes in a variety of categories including sports, finance and politics, called Pivit.

“Bitcoin and other distributed ledger technologies facilitate the transfer of digital financial assets within cryptographically secured, immutable environments. Case acts as a secure signing device that streamlines this process without increasing the risk of compromising sensitive data,” explained Case CEO Melanie Shapiro in a blog post.

Coinalytics Raises $1.1 Million for Blockchain Data Platform

Coinalytics, a “real-time intelligence service” for blockchain platforms, has raised USD$1.1 million in a seed round led by a Palo Alto-based startup incubator The Hive. The startup aims to provide risk management assessments and analysis technologies to help bitcoin startups, wallet providers, payment gateways and bitcoin exchanges to conduct risk assessments using blockchain analysis.

In an interview with Coindesk, Coinalytics CEO Fabio Federici explained that its clients can accept bitcoin transactions before they are confirmed by the bitcoin mining network, through its in-house tools for pattern recognition and its blockchain services.

“We analyze the inputs of the transaction, the structure of previous transactions and pull in metadata around those inputs to get a feel for whether the customer is reliable,” Federici told Coindesk.

Chronicled Inc. Raises $1.4 Million for Blockchain Authenticity Platform

Chronicled announced a $1.4 million convertible note financing lead by Colbeck with Mandra Capital, Pantera Capital, Social Starts and Seattle Seahawks running back Marshawn Lynch participating. The company is building a blockchain-based platform to verify the authenticity of consumer goods, such as branded apparel.

“The secondary market for luxury goods and collectibles is flooded with fakes, resulting in illiquidity and daunting consumer risk,” said Dan Morehead, CEO of Pantera Capital.

“Chronicled’s technology has the potential to make the market safe and efficient, while giving users a better experience. Luxury goods provenance represents a multi-billion dollar sector where blockchain technology can add unprecedented value.”