Bitcoin prices have fallen below $400 but that hasn’t stopped investors from plowing dollars into emerging digital currency companies ranging from bitcoin wallets to data providers to block chain APIs.
According to CB Insights data, investments in the bitcoin space hit an all-time quarterly high of over $107M already in Q4 2014 and there is still more than a month to go in the quarter. Deal activity in the space has also hit new highs in Q4 as well. The funding activity has been boosted by a handful of notable deals including Blockstream which raised $21M from investors including Reid Hoffman, Khosla Ventures and Real Ventures. Last month saw bitcoin wallet Blockchain and bitcoin mining firm BitFury Group raise $30.5M and $20M, respectively. The deal sizes within the bitcoin space are definitely stepping up in size.
In total, bitcoin startup investments now total over $400M in aggregate funding. It’s a far cry from Q2 2013, when total funding was under $25M and there were more investors than investor-backed startups in the bitcoin ecosystem.
Bitcoin startup funding vs. close price
Most interestingly, the rise in bitcoin startup investments has come as the price of bitcoin has dropped drastically since hitting record highs in November 2013. Using bitcoin close price data from Bitstamp, we analyzed aggregate funding to bitcoin startups vs. BTC close price since July 2010.
The contrast is notable. Since September, bitcoin prices have steadily dipped below $400 while funding to the space continues to accumulate.
Top Bitcoin startup funding rounds
The top 10 rounds to startups in the bitcoin ecosystem to date are listed below. Interestingly, Xapo and BitFury appear twice on the list due to tranched Series A deals. The largest single funding round in the space goes to Blockchain’s $30.5M round led by Lightspeed Venture Partners and Wicklow Capital. BitPay‘s $30M round from Index Ventures, AME Cloud Ventures, Felicis Ventures and Founders Fund among others came in a close second.
| Company | Round | Total ($M) | Select Investors |
|---|---|---|---|
| Blockchain | Series A | 30.5 | Lightspeed Venture Partners, Wicklow Capital |
| BitPay | Series A | 30 | Index Ventures, AME Cloud Ventures, Felicis Ventures, Founders Fund |
| Coinbase | Series B | 25 | Andreessen Horowitz, Union Square Ventures, Ribbit Capital |
| BlockStream Corp | Seed VC | 21 | Reid Hoffman, Khosla Ventures, Real Ventures, Mosaic Ventures |
| BitFury Group | Series A | 20 | Queensbridge Venture Partners, Binary Financial, Georgian Co-Investment Fund |
| Xapo | Series A – II | 20 | Emergence Capital Partners, Index Ventures, Greylock Partners |
| BitFury Group | Series A – II | 20 | Georgian Co-Investment Fund, Bob Dykes, Bill Tai |
| Xapo | Series A | 20 | Benchmark Capital, Fortress Investment Group, Ribbit Capital |
| Circle Internet Financial | Series B | 17 | Oak Investment Partners, Accel Partners, Breyer Capital, General Catalyst Partners |
| Bitnet Technologies | Series A | 14.5 | Highland Capital Partners, Rakuten, Webb Investment Network |
Analyze the most comprehensive bitcoin financing and exit data as part of CB Insights Private Company Financing Database. Sign up free below.
If you aren’t already a client, sign up for a free trial to learn more about our platform.