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Bitcoin Venture Capital Heats Up

Lightspeed Venture Partners’ Jeremy Liew published his perspective on the incredible opportunity to invest in companies that are building new ideas for the Bitcoin ecosystem. It looks like the Bitcoin venture capital is heating up.

There are three key markets in Bitcoin:

Wallet. Holding your Bitcoins for you, serving some of the checking account functions of a bank.

Exchange. Converting from USD to Bitcoins and back.

Payments. Helping merchants accept Bitcoins for their transactions.

As a rule of thumb, VCs like to see billion-dollar markets to get excited. How can each of these markets get to be a billion dollars in size?

To build multi-billion dollar opportunities, the Bitcoin economy needs to grow 100X from where it is today, Liew goes on to say. But to put that in perspective, it grew more than 10X in the last year.

These opportunities are not without risk. Liew acknowledges that in its short existence, Bitcoin has been the target of theft and over 10% of the Bitcoins in circulation have been stolen. This and other risks will make it hard to be build sustainable businesses, but not impossible.

Via TechCrunch.

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