Trammell Venture Partners, an Austin-based venture capital firm, announced the results of its proprietary research on the growth of the Bitcoin-native startup ecosystem that is accelerating global bitcoin adoption. In the first-of-its-kind research, TVP finds that despite the broad crypto market drawdown in 2022, the Bitcoin sector has emerged as a growth category in venture capital, seeing a 52.9% increase in deal activity year-over-year.
Even with tens of billions of dollars allocated to crypto and blockchain startups in recent years, there has been a distinct gap in institutional venture capital for founders focused on the Bitcoin tech stack and ecosystem. With a careful approach to avoid inducing risk associated with fast changes to Bitcoin Core, technical development has nevertheless proceeded. In the last two years, the growth of the Bitcoin startup category has begun to accelerate, as technology enablements such as SegWit (2017) and Taproot (2021) activations gave rise to the Lightning Network and other areas for entrepreneurial exploration and development.
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“We’ve known for years that there was a misallocation of capital for Bitcoin startups and now we have the data to support that assertion,” said Christopher Calicott, TVP’s managing director and founding partner. “Bitcoin—the first, best, and only truly decentralized ‘crypto’ asset—is becoming a platform at an accelerating pace. Despite its consistent market capitalization dominance, venture capital into Bitcoin startups in 2022 only represented about 1.3% of invested capital sector wide. TVP intends to change that.”
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With an eye toward driving research and insights for the broader venture capital investment landscape, TVP launched the venture industry’s first dedicated Bitcoin-native ecosystem-focused fund series in 2021. The release of TVP’s Emerging Bitcoin-Native Venture Capital Research Brief today marks a new phase of TVP’s plans to augment the available research for Bitcoin startups. This research aims to support the institutionalization of venture investment for this emerging growth category within crypto and blockchain venture capital.
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