Bitcoin Shop Inc. (BTCS, Financial) has revealed that they have raised a whooping $116 million through venture capital from high-profile investors. So far, this funding is the largest funding raised by a digital currency company. It seems that the Silicon Valley-based company's efforts in convincing global giants in the venture capital division to fund their company has finally borne fruit. The company has yet to go a long way in ensuring public adoption of Bitcoin as a currency. Bitcoin was always perceived to be risky and high volatile. However, with the advent of 2014, the perception changed, and many regulators began using Bitcoin as an alternate form of payment. It should come as a great surprise that a company, in its start-up stage has manged to garner so much funding. Bitcoin's market capitalization reached an all time high in January 2014 at $13.9 billion.
Smart Investors
Companies that actively participated in the funding include Yuan Capital, RRE Ventures, Khosla Ventures, Data Collective and Andreessen Horowitz. This piece of information was revealed by the CEO of 21 Inc., Matthew Pauker. Many other investors including eBay Inc.'s (EBAY, Financial) co-founder Jeff Skoll along with Peter Thiel and Max Levchin, co-founders of PayPal invested in the currency company. CEO of Dropbox, Drew Houtson and CEO of Expedia Inc. (EXPE, Financial) Dara Khosrowshahi were also a part of the funding. The largest contribution so far has been noted by Qualcomm (QCOM, Financial) Ventures, the investment division of Qualcomm Incorporated. Matthew Pauker said that 21 Inc. will reap the production capabilities of the subsidiary of the semiconductor company, Qualcomm Incorporated. Investors and public at large can expect a suite of unrevealed products in the next few months. Balaji Srinivasan, co-founder of Andreessen Horowitz, made a comparison of the venture funding to technological developments of wireless internet towers and 56-kilobit internet modems. According to him, households at large could even get a hold of Bitcoin if the company focuses on a long-term vision. However, the nature of operations are not being revealed as yet. Matthew added that all of 21's products –Â including hardware and software –Â will ensure the adoption of Bitcoin. He said one can expect "many interesting developments" in the months to come.
Bitcoin backdrop
Bitcoin, released as an online payment system in 2009 is said to have been invented by Satoshi Nakamoto. The system ensures that consumers can pay without any help from an intermediary. In-store merchants prefer using Bitcoin as a mode of payment since the processing fee is 2-3% less that the credit card fees. CEO Brian Armstrong wishes to expand the use of Bitcoin to 30 countries by the end of this year.
Road ahead
Though it is not known yet, insiders have given hints that 21 Inc. and Qualcomm may come up with Bitcoin-wallets. These wallets will be built-in on consumers smartphones. Qualcomm can break this deal since it produces and markets Snapdragon processors to smartphone giants like Samsung (SSNLF, Financial) , Sony Corp. (SNE, Financial), HTC Corp. (HTCXF, Financial) etc. Samsung and International Business Machines Corporation (IBM, Financial) decided to adopt ADEPT- a ground-breaking projects. ADEPT is a Bitcoin blockchain process in which electrical products interact with each other without human interference. IBM even conducted an investigation about the process and concluded that the process offers an “elegant solution” for logistical problems revolving round the Internet of Things. Cool, isn't it? It seems that 21 and Qualcomm have something great up their sleeves. The $116 million they raised will be put to use in a great way. Investors, better be ready to be amused! Balaji Srinivasan, co-founder of 21 Inc., said the company will build "a world run by software,” thus setting itself free from old institutions and government's rule.
