Blockchain Companies Seek and Find Funding Outside the U.S.

Blockchain Companies Seek Funding Outside the U.S.

Blockchain companies are actively seeking funding deals outside of traditional tech hubs such as Silicon Valley, according to a report by CB Insights and other analysts. Bitcoin is generating a lot of buzz recently but since 2013 blockchain technology in general has attracted some $1.2 billion in funding with about 650 equity deals closed in the past five years.

In 2013, the U.S. was home to 70 percent of all blockchain deals but the technology is maturing and the blockchain companies look elsewhere for financing. At present, 64 percent of all equity deals across the blockchain ecosystem are concluded outside the United States.

Where Blockchain Tech Gains Popularity

The top ten countries where blockchain companies get financing include the U.S., the UK, China, Singapore, Canada, South Korea, Japan, Switzerland, Netherlands, and Germany. Nonetheless, countries outside the top ten list see their share of blockchain funding rise from the meager 12 percent in 2013 to 33 percent of all deals in 2016.

Furthermore, countries like China are witnessing steady growth of blockchain tech financing with the country concluding 10 percent of the total blockchain equity deals in 2017 to date.

Image Source: CB Insights

Tokens Sales Are Skyrocketing

Last year, token sales stand at $256 million, a report by PitchBook reads. Blockchain companies have attracted some $550 million from venture capital investors alone in 2017 while token sales skyrocketed to some $2 billion since the start of the year.

Private investment into blockchain companies is topping $4.5 billion so far this year, including a $3.6-billion deal by U.S.-based Vista Equity Partners to acquire Canadian blockchain company DH Corporation. The number of blockchain transactions is decreasing from 203 to 152, year-over-year, but the amount of financing is growing, the report reveals.

The next wave of funding rounds for blockchain startups will come from private investors and token sales all over the globe, not only in North America. Large financial institutions such as banks, brokerages, and payment processors have passed the stage of exploring the new technology and now actively seek ways to adopt it across a variety of business use cases. Add the current rush for tokens and ICOs among investors, and you get a trend worth following for a while.

Investors Want Ready-to-Deploy Blockchain

A good number of those potential corporate investors do not have the resources to develop blockchain tech internally or are finding it cheaper to invest in already existing solutions and/or blockchain development

projects. Hence, one could expect that new financing rounds for early blockchain companies will occur on a massive scale in 2018, and will not be concentrated in one or two countries as in the past years.

Some early adopters are already reaping off the benefits of blockchain while others incorporate blockchain technology across platforms that currently do not take full advantage of the concept. Nonetheless, the use of blockchain across the FinTech and other industries is set to grow, so equity deals will be on the rise as well. Since a growing number of blockchain and FinTech startups are born outside of the U.S. and new tech hubs are emerging, increasing number of deals will be closed in Europe and Asia in the coming years.

By Kiril V. Kirilov

Martin Mendelsohn

The Growth of Third Party Risk Management (TPRM) Firms

Cybersecurity and the Continued Risks Back in the day, we played cops and robbers with sticks and plastic squirt guns.  Sometimes you were pursued, at other times you were the pursuer.  There wasn’t much more ...
Madhaven Krishnan

Steps To Achieve Hyper Productivity With Your Digital Apps Development

Achieve Hyper Productivity The mobile and cloud revolution in enterprise IT is well underway and is already causing never-before--seen changes in the way apps are developed, managed and transformed. The driving factors behind these changes ...
Ajay

Explainable Intelligence Part 3 – The Strategy for XAI

The Strategy for XAI It is not enough to say that something is true just because 'I know it’s true!' – we have to have some evidence or argument that gives a justification for our ...
Bittitan

Episode 6: Cloud Migration: Why It’s More Important Than Ever

The Importance of Cloud Migration Moving fully to the cloud is still a concern for many companies, but with millions of employees working from home, there’s an even greater need to migrate. Mark Kirstein, VP ...
Atman Rathod

UX Design in the Age of DevOps: Transformation Through Collaboration

UX Design in the Age of DevOps DevOps is popular among modern IT strategists because it leaves no scope for lapses in the development process. It incorporates a holistic approach to software development by bringing ...
Robert Van Der Meulen

Focusing on Online Gaming Security During Development

Online Gaming Security Infrastructure Updated article: June 2nd, 2020 There are millions of gamers around the globe and as of 2018, video games generated sales of US$134.9 billion annually worldwide. As video games continue to ...