Blockchain investment in the US this year has already outpaced 2017’s figures: Report
There is currently more venture capital funding on offer than opportunities to invest, implying vast growth.
Earlier this month, a research report forecast that spending on blockchain solutions would increase to $11.7 billion by 2022. Now, a new analysis has revealed that in the first half of 2018, blockchain investment in the United States has hastily eclipsed the total investment expended throughout the entirety of last year.
KPMG's biannual global report The Pulse of Fintech 2018 found that a substantial number of sizable blockchain deals occurred during the first half of 2018, propelling the industry beyond any previous accomplishments.
Based on our experience, the rapid growth in blockchain investment overall can likely be attributed to a number of factors - including the widespread applicability of blockchain to help harness efficiencies within financial institutions.
Extract from KPMG's The Pulse of Fintech 2018.
This year's largest blockchain-driven ventures included US$100 million+ funding rounds for enterprise software firm R3 and Circle Internet Finance. R3 is a consortium of over 200 members and partners across multiple industries, in both the private and public sector, who are developing the open-source platform Corda.
However, R3's consortium may be on the way out. Last month, anonymous insiders described a company on its last legs, expected to run out of money by the end of next year and "laughably off" its revenue targets.
KPMG also noted Paxos' US$65 million Series B fundraising efforts in May. Paxos, a New York-based blockchain-powered trust, managed to secure funding from venture capital firms RRE Ventures and Liberty City Ventures.
Initial Coin Offerings (ICOs) continued to attract interest, despite countries like China banning the practice.
"There’s more VC flow available than opportunities to invest - a sign of tremendous growth in the space," KPMG US financial services digital and fintech director and lead Safwan Zaheer said in the report.
Blockchain, a distributed ledger that keeps transparent records of digital transactions, has the ability to encompass all aspects of global transactions across every industry, not just banking and insurance firms.
KPMG's report speculates that there will be continued investment in blockchain applications into the future and that US investors are showing keen interest in cryptocurrencies, despite some trepidation over the high volatility that exists in the current marketplace.
The auditing firm suggests that we will continue to witness an emphasis on partnerships between retailers and technology leaders worldwide, developing relationships to secure a piece of the lucrative fintech value chain.
Distributed ledger technologies have a way of making the digital real, allowing properties like non-fungibility and finiteness to be reliably used in the digital world for the first time. For example, digital art auction house Portion is using blockchain technology to turn back the clock on some rooted online-only issues.
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