The amount of VC funding that has flowed into bitcoin this year is staggering. Last year was the best yet, but this year has already matched it. This is an extremely positive sign for bitcoin’s long term success. The “smart” money is flowing into bitcoin, and those companies and people don’t make a habit of throwing away hundreds of millions of dollars on a new technology unless it stands a good chance of returning their investment many times over.
The Bitcoin community understands this. Hundreds of millions of dollars don’t flow into an emergent technology if it is unlikely to break into the mainstream. But as nice as it is to see all this cash flow into the industry, it is even nicer when that cash is coming from the industry and community itself.
Shapeshift recently finished its second funding round, raising 1.6 million dollars. While it lacks the eye-popping numbers we have seen given to the likes of Circle and more recently Chain, it is in a way more impressive. According to Shapeshift’s CEO Erik Voorhees, roughly 90% of that investment came from individuals or companies that sit in or next to the bitcoin community. In fact, Shapeshift, which has quickly gained significant brand recognition within the cryptocurrency community since its founding a mere 14 months ago, had its initial seed funding in 2014 and that was also led almost exclusively by figures in the cryptocurrency market. Meaning, Shapeshift was funded almost entirely by members and figured in the Bitcoin community through two funding rounds.
This is significant for two reasons: The most obvious is simply that the Bitcoin space has enough cash flowing around that individuals and companies can afford to invest in itself. The other reason isn’t as obvious, but it is far more significant: Money always comes
Originally appeared at: http://coinjournal.net/internal-bitcoin-investment-fights-banker-influence-op-ed/