As Washington was discussing the nature of digital currencies, investors in China were busy closing a Series A round of venture funding for a Bitcoin exchange.
BTC China, the world’s largest exchange by volume, received $5 million from Lightspeed China Partners and Lightspeed Venture Partners on November 18.
The exchange had just blown past Mt. Gox and Bitstamp as the world’s largest exchange both in terms of volume and liquidity. On a normal day of trading, 90,000 Bitcoins pass through the exchange.
Approximately one-third of all Bitcoin trading takes place in China.
This news also coincided with Bitcoins hitting record highs, approaching $788 during the day.
Many analysts see the increasing prices as a reflection of the growing demand for Bitcoin in China. With a generation of tech-savvy citizens developing a taste for investments beyond stocks or real estate, a digital currency has attracted a lot of interest in China, where strict controls on hard currency and expatriating money are still in place.
Lightspeed Venture Partners manages more than $2 billion in capital and has advisors in the US, India and Israel. Along with Lightspeed China Partners, they have invested in more than 200 countries around the world over two decades.
LCP Managing Director Ron Cao said BTC China’s team inspired confidence because of its technology and it’s long-term vision.
“We think that under the leadership of the founding team, BTC China will continue to build out the Bitcoin ecosystem and bring more efficiency and value to the Chinese consumers, enterprises, and the overall financial services industry,” he said.
Beside’s being China’s largest Bitcoin exchange, BTC China was also the first. It has been in business now more about two and a half years.
BTC China CEO Bobby Lee said the investment will allow his company to continue to innovate and become “the best Bitcoin company worldwide.”
TechCrunch reports that the funding will go toward growth and expansion of the platform as well as covering normal expenses.
At the moment, BTC China users can only exchange Bitcoins and Chinese yuan. Stipulations for moving cash mean users have to use Chinese payment services or transfer money to a local Chinese bank.