On Thursday we had posted that merchant bitcoin payment processing firm, BitPay, was rumored to be closing a $30 Million Series A venture funding round, valuing the company at $160 million. Today, the deal has been officially announced by BitPay and several of its investors. The funding marks the largest investment to date of a bitcoin related fund, with BitPay having reached $32.7 million in total funding. In its public statement, BitPay commented that the funds will be used to expand globally, adding 70 jobs, mostly in development. The firm also announced that current CTO and Co-Founder Stephen Pair was moving to the position of CEO, with current CEO and Co-Founde Tony Gallippi becoming Executive Chairman.
Leading the investment round is Index Ventures, with participation from Horizons Ventures, Founders Fund, Felicis Ventures, RRE Ventures, TTV Capital, Sir Richard Branson, and AME Cloud Ventures. In a post titled Payment without border: Why we’re backing BitPay, Index Ventures stated that their excitement for bitcoins is based on its ability to provide a digital means of payment for the quickly growing online world which has reached 3 billion people.
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The view we hold is that, while Bitcoin’s value as an investment asset or a traded commodity– rather like the publicity surrounding it – may ebb and flow, the infrastructure that enables usage of the digital currency and allows these frictionless transactions to happen, is not only a necessary part of the ecosystem, but also fast becoming a critical part of the Internet’s own infrastructure.
Index Ventures compared their current investment to a previous one they had made in Skype. Just like funding Skype was a bet on the underlying VOIP technology, the same is true of investing in the bitcoin industry. Specifically explaining their interest in BitPay, Index Ventures explained that the firm is a “pure-play winner in bitcoin payment acceptance”
According to BitPay, the company is currently processing $1 million in daily bitcoin payments for over 30,000 merchants. Among customers, 50% are in the US, 30% in Europe, and 20% in the rest of the world.