Venture capital in blockchain sector approaches $300 million in first half of 2016

Rage Comment : According to a survey by Juniper Research, a British market research organization, blockchain technology and Bitcoin companies attracted $290 million in venture capital in the first half of 2016. Although more than 30 companies participated in the financing process, three of them received one-third of the total investment. They are social payment provider Circle, sidechain developer Blockstream, and Digital Asset Holdings, a distributed ledger company founded by Blythe Masters. The report uses The DAO incident as an example to warn people to carefully test the functions of the system before actually adopting blockchain.

Translation: Annie_Xu

According to a survey by British market research firm Juniper Research, blockchain technology and Bitcoin companies attracted $290 million in venture capital in the first half of 2016, during which more than 30 start-ups participated in the allocation of this fund.

Three companies accounted for a third of the investment: social payment provider Circle, sidechain developer Blockstream, and Digital Asset Holdings, a distributed ledger company founded by Blythe Masters.

Juniper’s latest report, titled “The Future of Blockchain: Bitcoin, Remittance, ID Verification & Smart Contracts 2016-2021,” highlights the diversity of emerging blockchain application development, ranging from identity to asset management.

The report noted that development activity in the banking sector was particularly high, with some banks already adopting Ripple’s blockchain protocol and other pilot programs.

The research institute pointed out that the use of blockchain-based systems in areas such as transaction settlement can continuously reduce the risk of failure and the time of troubleshooting.

Furthermore, blockchain technology could enable cross-border remittance service providers to provide lower-cost consumer services.

Smart contract flaws pose challenges

However, the report warns that if smart contracts use blockchain technology, then all blockchain users can see the content of these contracts, even loopholes and flaws.

The report mentions the case of The DAO (a Decentralised Autonomous Organisation), where a third party exploited a vulnerability in the network and stole nearly $80 million in cryptocurrency.

Dr Windsor Holden

Dr Windsor Holden, author of the report, said: "While blockchain has the potential to increase speed, transparency and security across entire industry verticals, each unique use case must be carefully tested before each decision is made."