California startup incubator Boost VC took a markedly different approach to its latest batch of early-stage companies, known in its own internal parlance as Tribe 6.
While Boost VC's Tribe 5 was dominated by bitcoin and blockchain startups – accounting for 90% of the 25 assembled companies, Tribe 6 was primarily focused on another emerging technology, virtual reality (VR).
But with their latest batch, CEO Adam Draper and co-founder Brayton Williams didn’t abandon their long-standing commitment to bitcoin, so much as take a step back. Tribe 6 still featured five blockchain startups, all of whom presented their product pitches at a Demo Day event in early October.
This time around, rather than hold its product showcase at the end of the program, Boost planned the event some weeks prior in an effort to offer greater help to its entrepreneurs as they sought to secure investments.
Draper told CoinDesk in October that the decrease in bitcoin startups in Tribe 6 was primarily due to the increased regulatory burden placed on bitcoin blockchain startups. The funding environment for startups, he said, was not a factor, citing data that indicates six of the 22 startups in Boost’s last class had so far secured follow-on investments.
Overall, Draper remains optimistic about the industry, adding that he hopes to see the number of blockchain startups equal the number of VR firms as part of its Tribe 7 batch, which is now accepting applications.
”We've never been more excited about bitcoin and the blockchain.”
According to Mender, Joystream aims to use bitcoin as a way to allow BitTorrent users to compensate others for their work in bringing content to the distributed network.
"BitTorrent is organized into small communities. To be part of these groups you have to leave your computer on for a certain amount of time, or upload a certain amount of content in exchange for how much you want to download," Mender explained.
JoyStream instead would allow users to compensate those who want to perform these tasks with bitcoin, in exchange for benefits such as faster download speeds and increased content access, sending payments in real-time alongside downloads.
Mender said a "very, very early" version of the product was released last month on the bitcoin testnet, meaning it currently does not exchange real bitcoins.
Currently, the platform has just “a few hundred” users, though it hopes to attract more as its nears a formal launch of services supported on the bitcoin blockchain.
Representing the international bitcoin community in the latest class was Singapore-based bitcoin options exchange CoinUT.
Launched in beta in October 2014, CoinUT offers both vanilla and binary options, products that give users the right to sell assets at a certain price at a later date, or enable users to speculate on the future movement of the bitcoin market for financial gain, respectively.
The startup believes vanilla options will appeal to risk-averse bitcoin traders looking to hedge against volatility in its price, while binary options will appeal to those with a more aggressive risk appetite.
Currently, CoinUT options are denominated in bitcoin only, with minimum trades set at 0.001 BTC (roughly $0.30) and a 40% margin set as the threshold users need to meet to maintain positions. Users can hedge bitcoin positions for up to two months.
The startup is currently operating in an area of the industry that features startups including LedgerX, Nadex and TeraExchange, each of which has entered the regulatory approval process due to their use of fiat currencies in their product offerings.
CoinUT’s creators have suggested that they are now working to create a socialized loss system and considering whether to add support for alternative digital currencies.
One of India’s longest-running bitcoin exchanges, Unocoin has seen both pros and cons from its early market entrance, so far attracting equal amounts of venture capital from avid industry investors including Barry Silbert’s Digital Currency Group, and regulatory scrutiny from domestic lawmakers.
According to Unocoin president Sunny Ray, the platform has seen a 23% increase in users over the past month as bitcoin’s price climbed to its highest levels seen so far in 2015.
Ray said Unocoin now has 30,000 registered users, with 3,000 of these new customers joining within the last three days. Further, he is optimistic this user growth will continue due to what he called the need for bitcoin in a part of the world where access to banking services remains limited.
Ray told CoinDesk:
"I truly believe that bitcoin is somewhat of a novelty, a rich person's plaything in developed countries. In places like India, it’s a necessity."
As for its application to Boost, Ray said this was borne out of a desire to work with bitcoin believers like Adam Draper and his father and Draper Fisher Jurvetson partner Tim Draper.
"To build a bitcoin business, you need the most wealthy and successful people in the world on your side," Ray concluded.
One of the longest-operating stealth projects in the industry, Epiphyte has been building blockchain solutions for the enterprise financial community since 2013.
Epiphyte can be viewed as one of the earliest attempts by the technology’s entrepreneurs to tap this now growing market, as the startup won a $50,000 prize as part of the Sibos 2014 trade show, where it was named "Fintech startup of the year".
Led by former Zynga senior product manager Edan Yago, Epiphyte touts "instant settlement for trades and transactions" but few details are public about its partners and offerings.
Still, Epiphyte does offer insight into its ambitions on its website, which reads:
"Imagine receiving payment at the same instant as performing an intuitional trade. With Epiphyte’s settlement system this now possible. Traders use our system to eliminate counterparty risk."
Another startup focused on investments, Wealthcoin is an app that allows users to speculate on stocks and bonds with bitcoin.
As the global bitcoin market becomes more stable, Wealthcoin offers a way for investors to leverage their bitcoin holdings to seek new types of financial gains. So far, the startup has attracted 200 users and has $10,700 in bitcoin under management to its closed beta.
There, users select investments by identifying their risk preference, whether conservative, moderate or aggressive.
"We work with advisors to build our portfolios using modern portfolio theory," Wealthcoin co-founder Simon Burns told CoinDesk, explaining that such portfolios then mirror indexes such as Nikkei or the S&P 500.
"If you wanted to buy into the S&P in local currency, say you want to buy in South African rand, there are products that enable you to track the S&P, so if it goes up 2%, your fund goes up 2% in local currency. We’ve done the same thing but bitcoin is the denomination."
Burns indicated users can opt out of investments at any time, and that there are no minimums on investment amounts. The startup charges a fee equal to 1% of its assets under management annually, though installments are paid on a monthly basis.
Wealthcoin said that it is currently navigating the "regulatory approval process" and that a larger public beta is expected to be available soon.
Image via Boost VC