Investment in bitcoin is outpacing that of the early Internet by almost 25%, according to a report today by the International Business Times, a London, U.K.-based newspaper. Venture capitalist investment in bitcoin startups is projected to be $786 million in 2015, compared with $639 million…
Venture capitalist investment in bitcoin startups is projected to be $786 million in 2015, compared with $639 million in Internet companies in 1996, the report noted.
The venture capital investing includes the $116 million raised by the San Francisco-based 21 Inc. in March, the most ever for a cryptocurrency sector startup.
Marc Andreessen from Andreessen Horowitz, the lead investor, said that bitcoin was similar to the Internet in its early years. He called it a “fringe technology” with “fringe characters” and “fringe politics.”
“In 1994, as a venture capital firm, it would have been a good idea to take the Internet seriously and it would have been a good idea to invest in a cross-section of (Internet) companies,” Andreessen said at the time.
This growth marks the second straight year that investment in bitcoin firms outpaced the early stage Internet. If it follows the same trajectory, venture capital investment could surpass $2 billion in 2016, the report noted.
According to PriceewaterhouseCoopers, Internet companies raised $1.88 billion from venture capital investments in 1997. The report also noted bitcoin’s improved stability is driving its use as a currency, with price volatility down 84%.
Despite this, the number of merchants accepting the cryptocurrency is ebbing while interest from consumers remains below 50%.
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Last modified: January 25, 2020 11:07 PM UTC