Blockchain Investment Reaches $120 Million in 2017Q1

News and Analysis

Over the first three months of 2017, overall investment in bitcoin and blockchain-related startups comprised $120 million spanning 21 deals. The officially announced funding of blockchain companies comprised $119.29 million with one more deal involving Tezos remaining officially undisclosed.

Considering the data published earlier by CB Insights, the amount is fewer than that for 2016Q1 ($175 million) and 2015Q1 ($226 million).

In per month terms, January financing comprised as much as $42 million, while in February the investment activity slowed down considerably to comprise $8.56 million overall. However, in March, the market experienced a blowing growth with the investment of $66.4 million.

Top 5 Investments

BitFury at $30m

BitFury is the leader in terms of funds raised over the period in question. According to the deal with Hong Kong-based Credit China Fintech, the latter shall invest $30 million in BitFury’s shares and participate in establishing a joint venture for the Chinese market. Thanks to the deal, BitFury has become one of the most well-financed companies in the entire blockchain industry. According to Crunchbase, overall amount of investment in BitFury has now reached $90 million.

Align Commerce (Veem) at $24m

March 8, California-based bitcoin startup Align Commerce has announced it raised $24 million and is rebranded itself as Veem. Series B investment round was led by the newly established National Australia Bank Ventures, GV (former Google Ventures) and SBI Investment Co.

Having found its niche in payments, Veem enables companies and payments platforms from around the world to send and receive funds in national currencies using blockchain technology leaving bitcoin invisible and irrelevant to end users.

Filament at $15m

March 30, Nevada-based blockchain startup Filament announced it closes another funding round having raised $15 million from Verizon Ventures and Bullpen Capital. The list of investors also includes Intel Capital, JetBlue Technology Ventures, CME Ventures, Lab IX, Backstage Capital and Tappan Hill Ventures. Additional funds came from the early investors being Samsung NEXT, Resonant Venture Partners, and Barry Silbert’s Digital Currency Group.

Filament develops blockchain-based IoT industrial apps for wireless networks. Additionally, the company manufactures hardware compatible with both new and traditional technologies.

ShapeShift at $10.4m

March 29, cryptocurrency exchange ShapeShift closed Series A investment round after raising $10.4 million of investment. The round was governed by EarlyBird, a Germany-based venture company focused on financing technological startups. The list of investors includes Lakestar, Blockchain Capital, Pantera Capital, Access Venture Partners, as well as such early investors as FundersClub, Digital Currency Group and Erik Voorhees.

The company intends to spend the raised funds on expanding its development team and creating new corporate products to be released this year.

Ledger at $7m

The fifth biggest deal of the quarter was also struck in late March. The development team of Ledger, a series of hardware cryptocurrency wallets, has announced the closure of Series A funding round at $7 million.

The investment round was led by MAIF Avenir, a subdivision of the French insurer MAIF. In addition to that, Ledger’s list of investors includes Xange, Wicklow Capital, GDTRE, Libertus Capital, Digital Currency Group, The Whittemore Collection, Kima Ventures, and BHB Network.

The company intends to use the funds for its market expansion. In May, it plans to open a new production facility in China.

Other Deals

Other notable investment deals of 2017Q1 include London-based blockchain startup Elliptic at $5 million, Blockstack at $4 million, Wirex and Storj at $3 million each, BitPesa at $2.5 million, Bitstamp at $2.35 million, and Germany-based well-known for The DAO drama at $2 million received from an anonymous investor.

This January, McKinsey & Co. predicted in their Blockchain Technology in the Insurance Sector report that bank investment in blockchain technology will reach $400 million by 2019.
Andrew Asmakov

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