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Not only has venture capital investing in Bitcoin failed to slow even as the price of the digital currency has slumped, but now some big Wall Street names have hopped on the bandwagon.
On Tuesday Bitcoin payments and wallet platform Coinbase announced it had raised $75 million in Series C funding. That's more than double the previous amount of venture capital invested in a Bitcoin company. San Francisco-based Coinbase has now raised a total of $106 million.
But this time it wasn't just the usual Bitcoin-friendly VC firms backing Coinbase.
Topping the list is the venerable New York Stock Exchange, a subsidiary of Intercontinental Exchange Inc. (NYSE: ICE).
"With this investment, we are tapping into a new asset class by teaming up with a leading platform that is bringing transparency, security, and confidence to an important growth market," NYSE president Tom Farley said in a statement.
Two other traditional names investing in Coinbase were financial services company USAA and Spanish banking giant Banco Bilbao Viscaya Argentaria SA (NYSE: BBVA). Japanese telecom firm NTT Docomo, Inc. (NYSE: DCM) also joined the round.
"Investors still have a pretty high conviction on Bitcoin despite what the spot price of Bitcoin is doing," Fred Ehrsam, a Coinbase cofounder, told The New York Times. "This really is people putting their money where their mouth is in terms of betting on Bitcoin as a technology trend."
Why the Top Dogs of Finance Are Investing in Bitcoin
That this new interest from conventional investors comes after a 67% decline in the Bitcoin price last year speaks volumes. They recognize that the real value of Bitcoin isn't the price on any given day, but the technology it's built upon.
That's also why so many tech-oriented venture capital firms have been investing in Bitcoin for more than two years.
Most of the VC firms in the latest Coinbase round, in fact, are no strangers to investing in Bitcoin. They include Andreessen Horowitz, Draper Fisher Jurvetson, Ribbit Capital, and Crypto Currency Partners.
They must see tremendous potential in Bitcoin to dump millions of dollars into cryptocurrency startups. And now traditional investors are seeing that potential, too.
About the Author
Dave has been a journalist for more than 35 years, including 18 spent at The Baltimore Sun. He has worked as a writer, editor, and page designer at different times in his career. He's interviewed a number of well-known personalities - ranging from punk rock icon Joey Ramone to Apple Inc. co-founder Steve Wozniak.
Over the course of his journalistic career, Dave has covered many diverse subjects. Since arriving at Money Morning in 2011, he has focused primarily on technology. He's an expert on both Apple and cryptocurrencies. He started writing about Apple for The Sun in the mid-1990s, and had an Apple blog on The Sun's web site from 2007-2009. Dave's been writing about Bitcoin since 2011 - long before most people had even heard of it. He even mined it for a short time.
Dave has a BA in English and Mass Communications from Loyola University Maryland.