The bitcoin and blockchain world is in a bit of an investment slump.
Venture money flowing into startups working on cryptocurrencies or the technical principles underpinning them, generally known as blockchain technology, is getting harder to come by, according to data from trade publication CoinDesk. “It really seems like we’re in a slow phase with bitcoin and blockchain right now where people are mainly building infrastructure,” says Zavain Dar, a venture capitalist at Lux Capital who has taught classes on cryptocurrency at Stanford and has invested in Blockstream, one of the biggest companies in the sector.
What’s more, efforts to adapt blockchain tech to replace legacy financial systems by the world’s biggest banks seem to be hitting roadblocks. This week saw the departures of Goldman Sachs and Santander from one of the highest-profile attempts to create a consortium of financial institutions to work on the technology, called R3CEV.
It seems that both risk-loving venture capitalists and generally risk-averse banks are dialing back their investment in a technology that was supposed to change the world—but hasn’t, as Timothy B. Lee at Vox has pointed out.
Startups working on blockchain tech have raised $376 million so far this year, which is 17%