Blockchain Capital, a San Francisco based venture firm which specializes in bitcoin and crypto projects, plans to invest in companies and uprising cryptocurrencies.
The firm was founded in 2013 by Bart and Bradford Stephens, the two brothers established the company along with Bitcoin Foundation chairman Brock Pierce. Blockchain Capital is setting out to raise $150 million in two funds and has invested in 42 companies within the previous three years.
According to the company website, it has stakes in digital asset exchange Coinbase, also bitcoin wallets Xapo and Abra.
Blockchain Capital disclosed in Monday’s SEC filings that the individual fund is raising $75 million. Currently, Blockchain Capital IV has gathered $60 million, while Blockchain Capital Parallel Fund IV has raised $25 million.
Although the two funds are identical with the money’s purpose, the parallel fund will involve limited partners that will cooperate by providing cryptocurrencies like ethereum and bitcoin rather than fiat currencies like the usual dollars and euros, according to a source.
The contributed funds will drive Blockchain Capital to continue with its investments in companies that are building on the top of the blockchain digital ledger. This leads to buying tokens in cryptocurrency projects.
Since 2017’s first quarter, there had been much hype in initial coin offerings, in which crypto companies earn money by building and selling their own currencies.
Active Blockchain Industry Bets
The financial sector has been the most active in regards to the technology of money transfer and as blockchain is starting to seep into the business industry, major world corporations are betting on it.
Venture capital has already placed their bets on over a hundred of blockchain companies while banks and corporations are investing in a few of them. Data shows that all 10 of the largest U.S. banks by assets have tried their hand in the sector, investing $267 million in one consortium and six blockchain companies.
Digital Currency Group, Blockchain Capital, Draper Associates are the top three most active firms ranked by number. The list also includes Andreessen Horowitz and Union Square Ventures.
ICOs are rising well above the historical average of $3 million, compared to traditional venture financing in the sector for early-stage blockchain deals. According to the report, “many of these companies could run the risk of mismanagement after receiving such large sums in such a short time.”
Since blockchain is still in its early stages, corporate investors will have to analyze wisely at the bets that they will risk and see which has the greatest potential to survive.+
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