Venture capitalists invested more than $58.8 billion in startups in 2015. Of this $14.8 billion in FinTech funding came in during 2015 in North America. $474 million went to Bitcoin, funding various startup platforms and products centered around Bitcoin and blockchains. Just as Jamie Dimon, the CEO of J.P. Morgan Chase Bank said back in 2014, “there are hundreds of startups with a lot of brains and money working on various alternatives to traditional banking.”
There are three key aspects we might witness with regard to bitcoin and blockchain:
1) Investment Funds Will Keep Flowing
2016 witnessed $1.1 billion in funding for new Bitcoin- and blockchain-based businesses. This funding is due to the increased attention on the power behind blockchains and distributed ledgers, and their potential to impact industries much beyond finance. Not to mention, the implications of Bitcoin-powered Internet of Things devices in the real world.
You have specific markets within Bitcoin and blockchains on many levels. People can invest in mining farms, network nodes, margin lending, day trading and so much more. We are seeing the emergence of a sustainable economy built around Bitcoin and related technologies.
2) More Startups = More Innovation
All the platforms and products built with blockchain or Bitcoin support mean new innovative services and products will emerge at an ever faster pace in the future.
We already have seen many great examples, including:
But with new innovations we discover new things. The Decentralized Autonomous Organization (DAO) is the perfect example; this project received more than $150 million in crowdfunding before the technology behind it was hacked.
3) Changing Trade Settlement Forever
There is a focus on transforming trade settlement to be faster and more transparent. The CEO of Overstock.com is trying to do just that, and as a result, he created T0.com last year. A few weeks back, the company partnered with a securities broker dealer to create the first publicly made equity issuance.
This is seen as a potential alternative to the way Wall Street handles trade settlement. Another attempt is going on in Unity Settlement Coin, a UBS-backed project.
We’re only now just starting to see the potential possibilities of a digital finance world with Bitcoin and blockchains serving as the backbone. Ultimately the impact will be felt much beyond finance – as you can imagine, decentralized marketplaces, networks, and payment and trading platforms are just the starting point.