VC Firms are Pouring Huge Money in Crypto Starups, Coinbase Unveils 2018 Earning
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Big corporations and venture capital companies are pouring huge sums of money in crypto and blockchain startups, says a Reuters report. While not exposing themselves directly to the volatile crypto assets, the big corporations are supporting startups developing protocols for blockchain and crypto.
So far in 2019, over $850 million worth investments have already arrived in the crypto sector. Last year in 2018, despite the severe crypto meltdown, the crypto and blockchain sector attracted investments worth a whopping $2.4 billion. More importantly, giants like Microsoft and the London Stock Exchange made major investments.
Some of the other mainstream investors include Polychain capital, Andreessen Horowitz, and banking giants like Goldman Sachs. It suggests that venture capitalists and global organization still have hopes on the future of blockchain technology. Jamie Burke, the Outlier Ventures CEO, said:
“There is a huge experimentation in effectively the basic plumbing for a native economic layer to the web.”
Richard Hay, UK head of fintech at law firm Linklaters, said that companies are looking into how blockchain can bring a meaningful change going further. Hay said:
“There are two dynamics at play. We can get something up and running and achieve cost savings, and also look longer term at ways of deploying the technology in more transformative ways.”
Tokenization of Assets
The key reason behind corporates making huge investments is that many believe that tokenization will be the key to drive the digital economy of the future. Anton Ruddenklau, the co-head of the global fintech division of KPMG said:
“People are really enamored by tokenization – the ability to produce coins or other forms of value – so that’s where we see all of the action at the moment. They are investing as a technological hedge as much as anything.”
The data compiled by PitchBook shows that companies are investing in crypto startups making cryptocurrency mining gear, or building trading platforms, etc.
Coinbase Registered $520 Million in Revenue Last Year
The Reuters report also shows that popular crypto exchange Coinbase made $520 million in revenues last year in 2018. Also, the company’s U.K.-based arm contributed nearly one-third of the overall revenue. The report notes that Coinbase U.K. registered 20% jump to $173 million, said Coinbase U.K. CEO Zeeshan Feroz.
Zeeshan also said that Coinbase U.K. made a net profit of $7.4 million last year. On Thursday, April 18, crypto exchange Coinbase also made an important announcement of expanding its operations across 11 countries in Latin America and Southeast Asia. The company has planned a full-fledged expansion in these places.
In these regions, customers will also be able to use Coinbase’s crypto-to-crypto trading services along with the Coinbase mobile app for iOS and Android.
Article source: “https://www.coinspeaker.com/vcl-crypto-startups-coinbase/”