Concentric, the London and Copenhagen based venture capital firm, has launched a fund dedicated to early-stage companies based on bitcoin.
The fund, called Timechain, has currently raised over half of its $21m (£18.3m) first close target.
The VC will focus on pre-seed and seed investments between $100,000 (£87,300) and $1m (£873,000) in companies building infrastructure solutions for bitcoin including mining – where new bitcoins are created and enter circulation; and decentralized finance – an unregulated financial ecosystem based on blockchain technology.
Six investments totalling £1.7m have already been completed from the fund, including a stake in London-based start-up Unmapped Digital Mining, a 100 per cent off grid, renewable bitcoin miner.
Currently, a vast amount of electricity is used to mine bitcoin via highly powered computers, contributing to a significant carbon footprint. Research from the University of Cambridge found bitcoin miners around the world use as much energy as the Netherlands did in 2019.
“We believe bitcoin presents the greatest asymmetric value creation opportunity in history because bitcoin is perfected money and money itself is the largest market on the planet,” Alexander Mann, a partner at Concentric who is heading up the fund said.
“Venture capital funds have missed this fact and have instead created hype around blockchain technologies that are built on unsound foundations and have no genuine use-cases despite billions of dollars of investment.
“Our deep-seated conviction is that bitcoin is widely misunderstood and underappreciated, both as a monetary asset and a monetary protocol. With recent developments to the lightning network and exponential grassroots adoption, it is the perfect time to invest in scaling bitcoin infrastructure to rearchitect the monetary system and our economic system more broadly.”
The lightning network intends to speed up transactions and eases up network congestion.
“For this reason, Timechain’s sole focus is on supporting bitcoin only companies focused on creating lasting value rather than selling worthless tokens to an unsuspecting public.”
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