London-based startup Blockchain has raised $40m in funding, the largest amount for a fintech company in the UK since last year.
The new funding round was led by GV, the venture arm of Google’s parent company Alphabet. European venture capital firm Lakestar was involved too, as well as Nokota Management and Digital Currency Group.
Blockchain makes software that allows people and businesses to make transactions using digital currencies, such as bitcoin. Tom Hulme, general partner at GV, said the firm invested because “the pace of innovation in the digital currency space is unmatched.”
The startup, which was founded in 2011, is named after the online platform that records and validates transactions using cryptocurrencies. Blockchain’s total funding is now more than $70m.
The use of online currencies, such as bitcoin and ether, has been growing in popularity, allowing startups like Blockchain to flourish.
Co-founder and chief executive Peter Smith said that the startup was completing the equivalent of $2.5bn in transactions on a monthly basis through its consumer virtual wallet product.
In addition, Smith said the day Donald Trump was voted US president, Blockchain has the second-highest number of new users sign up in a single day.
At the moment, one bitcoin amounts to $2,677, however before you begin investing all your money into bitcoin these cryptocurrencies are considered to be fairly volatile compared to normal currencies.
For instance, Ether, the currency used on the Ethereum blockchain, flash-crashed this week from highs of $300 to as low as 10 cents. However, it is now back to over $300.
As well, Bitcoin is set to smash the $3,000 mark – leading to concerns that the currency is a bubble which is set to burst any day now.
Despite the volatility, other blockchain startups are seeing high levels of investments. According to the analysis company CB Insights, blockchain startup deals rose for the third consecutive quarter in the first three months of 2017.
According to its research, $141m was invested across 41 deals. Blockchain consulting firm BitFury received $30m in funding from companies such as China Credit Limited Holdings. This was the largest deal in the first quarter of 2017.
Venture capital firm Digital Currency Group, one of Blockchain’s latest backers, is the most active bitcoin and blockchain investor according to CB Insights, investing in a total of 65 different startups in the space since 2012.