22 July 2014

Start-up raises $9m to take bitcoin mainstream

01 November 2013  |  5745 views  |  0 bitcoin

US start-up Circle has secured $9 million in funding as it bids to bring digital currencies such as bitcoin to mainstream businesses and consumers.

Despite the hype it has garnered in recent months, bitcoin is still a niche currency, more popular with speculators and drug dealers than legitimate retailers and shoppers.

Circle, founded by serial entrepreneur Jeremy Allaire, is promising to build products and services that will make it far easier for merchants and consumers to adopt the currency.

Although details are scant, the start-up says it is building a secure architecture that will increase consumer privacy protection and provide tools for making payments and sending and receiving digital currency.

Meanwhile, for businesses and charities, Circle is working on tools and services that allow them to accept payments - both online and in-store - in digital currency with no transaction fees, unlike the card giants.

Allaire, who previously founded online video platform Brightcove, has secured $9 million in series a funding from Jim Breyer, Accel Partners and General Catalyst Partners to get the firm - which is based in Boston and has its international operations in Dublin - off the ground.

Says Allaire: "Bitcoin and digital currency represent a once-in-a-lifetime opportunity to shape the future of the Internet and global commerce. There's a tremendous opportunity to make payments easier, more secure and less costly for consumers and businesses. Digital currency can dramatically reduce the friction and costs currently experienced in the world by merchants and consumers."

With governments showing a keen interest in bitcoin, Circle says that it is regulated by the Financial Crimes Enforcement Network as a money transmitter and is seeking appropriate state licenses. In addition, industry veteran John Beccia has been brought on board as general counsel and chief compliance officer.

The regulatory uncertainty and bad publicity surrounding the recent Silk Road bust, has led many in the bitcoin community to try to gain respectability, meeting with government officials in a bid to bring the currency into the fold.

However, this has caused a backlash among some of the virtual currency's early adopters, who want to maintain its anarcho-libertarian, anonymous roots and accuse the Bitcoin Foundation of betraying its principles.

In a bid to prevent the march towards assimilation with the mainstream economy, several well known players in the community - including 3D gun inventor Cody Wilson - are hitting back with a project to build their own 'dark wallet'.

The Dark Wallet, set to be released early next year, will be a light browser extension designed to make the currency impossible to trace and negate any rules bought in by governments around the world. The collective have set up a page on crowdfunding site Indiegogo in a bid to raise $50,000 for the project.

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