Blockchain VC Investment Surged 316% in 2018, New Study Finds

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Venture capital investments into the blockchain industry have surged in 2018 as retail speculation faded away, a new report reveals. Sign of Maturation? According to a press release sent to Bitcoinist, a new report dubbed Q3 State of Blockchains prepared by European venture firm Outlier Ventures reveals that VCs are particularly active across all funding stages and that 119 deals are disclosed in Q3 of 2018 alone. One noteworthy detail is that the more quality

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Ex-SEC Commissioner and Investment Banking Veteran Join Bitfury Team

Bitfury has added an investment banker to its board of directors and a former U.S. Securities and Exchange Commission (SEC) member to its advisory board.

Blockchain technology firm Bitfury has added an investment banker to its board of directors, and a former U.S. Securities and Exchange Commission (SEC) member to its advisory board, according to an official company blog post Nov 21.

Founded in 2011, Bitfury is recognized as the largest non-Chinese company that develops Bitcoin (BTC) blockchain software and provides infrastructure for BTC mining.

The newly-appointed voting member to the Bitfury board of directors, Antoine Dresch, is co-founder of tech industry-focused private equity (PE) fund Koreyla Capital. Dresche has over 20 years of experience in investment banking with Goldman Sachs, UBS London and Morgan Stanley, according to a Bloomberg executive profile.

At Morgan Stanley, he oversaw major merger and acquisition (M&A) and Initial Public Offering (IPO) transactions in Europe, before founding Dresch Digital Media Advisory (DDMA) in 2011 to advise European media and Internet investors. As of 2016, he has been a partner and co-founder of Paris-based Korelya Capital, a €200 million ($228.1 million) PE fund.

Bitfury’s new advisory board appointee, Annette Nazareth, is set to provide guidance on regulatory matters in financial markets and advise on company growth.

As a former SEC Commissioner, Nazareth worked on a range of regulatory initiatives, including “execution quality disclosure rules, implementation of equities decimal pricing, short sale reforms, corporate debt transparency rules and modernization of the national market system.” Alongside her regulatory experience, she is head of the Trading and Markets practice at the Washington D.C. office of international law firm Davis Polk & Wardwell.

As revealed late October, Bitfury is reported to be considering its own IPO, with sources “familiar with the matter” claiming the firm is examining a range of options, including raising debt financing or selling a minority stake. Bitfury has allegedly been in contact with global investment banks in regard to its plans.

In September, Bitfury launched a new generation of its BTC mining hardware based on an advanced Application-Specific Integrated Circuit (ASIC) chip, Bitfury Clarke, just before another global mining hardware titan, China-born Bitmain, launched its own new ASIC.

This hire is not the first time a former SEC employee has entered the crypto industry, as a former SEC chair is representing Ripple in a class action lawsuit for the alleged sale of unregistered securities. Wall Street players have also often left for the crypto sphere; for example, former Goldman Sach executive joined Mike Novogratz’s crypto merchant bank in April.

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Yale University Invested in New $400 Million Crypto-Focused Fund, Says Report

Ivy League American university Yale is said to be one of the investors that has helped to raise $400 million for a major new cryptocurrency-focused fund.

Ivy League U.S. university Yale is said to be one of the investors that helped to raise $400 million for a major new cryptocurrency-focused fund, Bloomberg reports October 5.

The fund, dubbed ‘Paradigm,’ was reportedly created by Coinbase co-founder Fred Ehrsam, former Sequoia Capital partner Matt Huang, and Charles Noyes, formerly of stalwart crypto fund Pantera Capital.

Huang was said to have left Sequoia in June to embark on establishing the fund together with Ehrsam, according to reports from the Wall Street Journal at the time.

Bloomberg has today cited an anonymous source as saying that Yale – whose $30 billion endowment is reported to be the second-largest among U.S. higher education institutions – has made an investment of an undisclosed size in Paradigm.

Bloomberg further reports that 60 percent of Yale’s assets for the fiscal year 2019 are earmarked for “alternative investments” including “venture capital (vc), hedge funds and leveraged buyouts.”

According to Bloomberg, the fund reportedly plans to invest in “early-stage” crypto-focused projects, new blockchains and digital asset exchanges.

This summer, Cointelegraph reported on a group of economists from Yale that created a “comprehensive” analysis of the “risk-return tradeoff” of major cryptocurrencies such as Bitcoin (BTC), Ethereum (ETH), and Ripple (XRP), based on their historical performance data.

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Venture Capital Investment in Blockchain and Crypto Up 280% in 2018, Report Shows

A new report from Diar reveals that “traditional” venture capital investment in blockchain and crypto firms has almost tripled in the first three quarters of 2018.

“Traditional” venture capital (VC) investment in blockchain and crypto firms has almost tripled in the first three quarters of 2018, according to a new Diar report published September 30.

Diar cites data from Pitchbook that indicates that blockchain and crypto-related firms have raised almost $3.9 billion in VC capital in so far this year — a 280 percent rise as compared with last year. The rise comes not just in terms of an increasing number of deals, but also in the burgeoning median value of each, which has grown by over $1 million this year.

VC investment and deal count in blockchain and crypto-related firms, 2013-18

VC investment and deal count in blockchain and crypto-related firms, 2013-18. Source: Diar

VC median blockchain investment, 2013-18

VC median blockchain investment, 2013-18. Source: Diar

The combined total of the ten largest deals in 2018 came to $1.3 billion, with nine of these representing traditional equity investments, rather than purchases of utility crypto tokens. The outlier was the DFINITY token, which raised a combined $163 million from VC investors Andreessen Horowitz, Hashed, and Polychain Capital.

Pitchbook’s figures revealed that Barry Silbert’s Digital Currency Group (DCG) was “by far” the most prolific investor from the VC sector, closing over 110 deals in the crypto and blockchain space this year. DCG outflanked both Blockchain Capital and Pantera Capital, whose combined deals clocked in at 100.

Other strong investors included VC firms Andreessen Horowitz, Danhua Capital, and Future Perfect Ventures, alongside “active angels” Tim Draper, Naval Ravikant, Roger Ver, and Barry Silbert.

Beyond these major players, Diar reports that close to 2,000 investors have closed deals with at least one blockchain firm this year — the fifty most active of these have invested in “at least” eight. In terms of investor profiles, 52 percent of investors were not exclusively focused on the crypto and blockchain sector, but sealed their deals as part of a more diverse portfolio.

Lastly, Diar also analyzed the geographic distribution of the VC capital that flows into blockchain, with U.S.-based investors representing the lion’s share at 79 percent, followed by 12 percent from China, and 2 percent from South Korea and Singapore respectively.

Diar’s new report also includes a section on the phenomenon of new banking operations that aim to facilitate the blockchain industry, whether blockchain-exclusive banks built “from the ground up,” banks that integrate fiat and crypto services, or the rising number of crypto-related firms that are securing banking licenses.

As reported earlier today, South Korea’s largest VC firm, Korea Investment Partners (KIP), has invested in its first blockchain startup — one that specializes in harnessing the technology for supply chain management solutions. KIP is known for its investments in high-ranking firms that include Naver — Korea’s largest search engine, as well as owner of the popular Japanese messaging app LINE — and Korean messaging giant Kakao, among others.

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Fintech Investor Ribbit Capital Sets $420 Million Goal for Its Latest Fund

Venture capital firm Ribbit Capital, whose portfolio includes Coinbase and Robinhood, is planning to raise $420 million for its latest fund.

U.S.-based venture capital firm Ribbit Capital, the portfolio of which includes notable cryptocurrency and blockchain projects, is aiming to raise $420 million for its latest fund, according to an SEC filing dated September 12.

The fund will reportedly be the fifth venture of Ribbit with limited partners, while the $420 million figure is a “nominal increase” from the $300 million the company attracted last year.

Founded in 2012, Ribbit’s portfolio is marked by cooperation with such industry leaders as cryptocurrency exchange Coinbase, zero-fee stock and crypto trading platform Robinhood, finance company Credit Karma, and automotive insurance platform Root Insurance.

Ribbit Capital has also invested in Andreessen Horowitz, Battery Ventures, and Cross River Bank, which according to TechCrunch provides the “sole link” between many fintech companies and regulated financial institutions.

In April, U.K.-based alternative banking app Revolut raised $250 million in a Series C investment round led by Ribbit Capital, along with two other venture capital firms DST Global and Index Ventures. The raised money gave the company an overall $1.7 billion valuation and thus making them a “unicorn” – a startup with over a $1 billion valuation.

Robinhood began offering trading services for digital currencies in February, having raised $363 million in a series D funding round and $110 million in a series C round. Following the funding rounds, Robinhood was valued at $5.6 billion, making it the second most valuable fintech startup in the U.S.

Coinbase, which was founded in 2012, has since grown to be a leader among crypto exchanges and wallet services in the U.S. This year, Coinbase extended its services when it launched Coinbase Pro, and evolution of GDAX that is geared towards individual traders. Recently, the exchange opened trading for four cryptocurrency pairs with the U.K pound sterling.

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