Blockchain wallet business pockets $40m of new venture funding

London-based startup Blockchain, which as the name might suggest is based on blockchain technology, has received $40m in venture capital (VC) funding.

The series B round – led by VC firm Lakestar and GV, the VC arm of Google parent Alphabet – is one of the largest fintech fundraisings since the EU referendum.

Nokota Management and Digital Currency Group also joined the round, while existing investors Lightspeed Venture Partners, Mosaic Ventures, Prudence Holdings, Virgin, and Sir Richard Branson also participated.

“This brings our total capital raised to over $70m, and we’re thrilled to welcome some of the most well-respected investors in the world to the Blockchain family,” said Blockchain's chief executive Peter Smith.

Blockchain (the business) is a software company which creates digital wallets to hold cryptocurrencies, such as bitcoin.

Bitcoin wallets are analogous to a bank account, and can take the form of a software wallet stored on a computer hard drive, an online web-based service or a “vault” service that keeps its contents protected offline.

Bitcoin payments can be made from the wallet at the click of a button by sending an amount to a bitcoin “address”.

A growing number of merchants are now accepting these digital payments – including Big Four accounting firm EY, which last year became the first advisory firm to accept bitcoin for its services.

Both the wallets and the bitcoin cryptocurrency itself are based on blockchain technology, which in its most basic form is a digital ledger of transactions.

When a transaction completes, it is entered onto the blockchain and a specialist network of “mining” computers use algorithms to agree that this transaction occurred.

A copy of the blockchain is stored on every one of these machines, meaning that if one ledger fails, no data is lost.

Bitcoin has had a rollercoaster ride in terms of its value so far this year, as the currency hit heights of $3,000 before dropping again.

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