Financial institutions join record-breaking bitcoin funding round

Financial institutions join record-breaking bitcoin funding round

Three major financial institutions have contributed to a record-breaking $75 million investment round in bitcoin startup Coinbase.

The New York Stock Exchange, USAA and BBVA joined former Citigroup chief Vikram Pandit and ex-Thomson Reuters CEO Tom Glocer to participate in the biggest investment in a bitcoin company to date.

The round was led by DFJ Growth, with participation from existing investors, including Andreessen Horowitz, Union Square Ventures, and Ribbit Capital, and brings the total capital raised by the company to $106 million.

San francisco-based Coinbase says 1.9 million people have created 2.1 million bitcoin wallets on its service since its inception in 2012, which aims to make it easy for people and companies to buy and exchange bitcoin.

The company says the funding will be used to expand into international markets (NTT DoCoMo, Japan's largest telco also participated) and pick up the tab for money transmission license fees across the US.

The New York Stock Exchange says it will work with Coinbase to "bring additional transparency to bitcoin pricing.

“With this investment, we are tapping into a new asset class by teaming up with a leading platform that is bringing transparency, security and confidence to an important growth market,” says Nyse President Tom Farley. “We look forward to supporting Coinbase’s growth utilising our global distribution capabilities and market expertise.”

The recent slump in bitcoin prices and volatility around the currency has not deterred financial interest in its transformative potential, as BBVA Ventures makes clear with its investment.

"At its core, Bitcoin is a decentralised protocol that enables exchange of value among parties around the world, giving it the potential to alter the financial services landscape," says BBVA Ventures executive director Jay Reinemann. "By serving consumers, merchants and developers alike, Coinbase touches the most important aspects of that emerging ecosystem, giving it one of the best viewports into new developments and applications for the technology."

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