In a blog post on Monday, Palo Alto-based cryptocurrency security firm BitGo, Inc. announced it had raised a US$12 million Series A round of funding.
BitGo, which launched a multi-signature Bitcoin wallet in 2013, has drawn the attention of some well-known institutional investors, including venture capital firm Redpoint Ventures, which led the funding round. Other investors included Radar Partners, Founders Funds, Bitcoin Opportunity Corp., Liberty City Ventures, Crypto Currency Partners, and Ashton Kutcher’s A-GRade Investments.
“We are still in the early innings of the Bitcoin revolution,” BitGo CEO Will O’Brien said in a statement. “BitGo’s mission is to secure the world’s Bitcoin. By solving Bitcoin’s early security concerns for our customers and industry partners, BitGo is excited to help the Bitcoin industry grow with what we believe will be a speed and scale comparable to the Internet itself.”
BitGo’s multi-sig technology
BitGo promises “enterprise-grade” security with its multi-signature Bitcoin wallets.
Here is how their patent-pending tech works: each wallet has three private keys, two of which are required to make a Bitcoin transaction. The company holds one key, the user controls a second key, and a third key is stored offline.
“This makes our wallet virtually hack proof,” the company’s website reads.
“Unlike most other Bitcoin companies, BitGo doesn’t have the ability to access your Bitcoin. We only hold one key, which isn’t sufficient to transact on your behalf.”
Changes to BitGo’s board of directors
In the same announcement, the company said that Redpoint founding partner Jeff Brody and former Verisign CEO Stratton Sclavos, now of Radar Partners, would join its board.
“Bitcoin has opened a new frontier much like the advent of the commercial Internet in 1994,” Sclavos said. He concluded:
“This new industry simultaneously promises endless possibilities while facing meaningful security threats. We believe that Bitcoin’s inherent advantages over existing financial services infrastructure, combined with BitGo’s best-in-class security platform, will accelerate the adoption of digital money as fundamentally as the Internet changed global communication and publishing.”