Founded in 2014 and led by CEO and ex-JP Morgan executive Blythe Masters, Digital Asset Holdings had long been the subject of speculation that suggested that, despite its high-profile leadership, the startup was having difficulties raising an initial funding round.
All that uncertainty was laid to rest last week, however, when Digital Asset silenced rumors by raising upwards of $50m (some reports say $52m was the total) from 13 major financial institutions, among them traditional financial giants such as Citi, CME Ventures and Santander InnoVentures.
The $50m round is the largest to date for a startup seeking to use private or permissioned blockchain technology, which unlike the open-source bitcoin network, is purposed for use by a selected number of trusted institutions for use cases including syndicated loans, US Treasury repo, foreign exchange, securities settlement and derivatives.
Further, the news comes amid a decline in funding for bitcoin-focused startups in the sector. Data from the forthcoming CoinDesk State of Bitcoin 2015 Report, for example, reveals that, when revised historically, "blockchain startups" have collected 34% of the estimated $1bn in publicly reported industry funding.
For many observers, the Digital Asset round confirms what they believe is a trend that suggests venture capitalists are increasingly interested in blockchain startups, and that bitcoin-focused companies are experiencing more difficulties.
However, some of bitcoin’s most high-profile supporters in the venture capital community believe that the attention the Digital Asset round brings to blockchain technology is good for ecosystem as a whole, even for startups focused on the public bitcoin blockchain.
Tally Capital founding partner Matt Roszak told CoinDesk:
At a high level, it’s a positive signal that people are putting money into this space. The public vs private blockchain debate is a different dynamic, but it's important for financial services companies, and Wall Street, to invest in this space
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