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Belfast company is Bitcoining it in with mega £9m deal

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Bitcoin transactions have topped £28.7bn since its launch three years ago

Bitcoin transactions have topped £28.7bn since its launch three years ago

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Brendan Smyth, chief operating officer of Bitnet

Brendan Smyth, chief operating officer of Bitnet

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Bitcoin transactions have topped £28.7bn since its launch three years ago

Fledgling Belfast company Bitnet - set up to capitalise on the growing internet trade in digital currency bitcoins - has won a £8.9m investment from a major US fund.

Bitnet is providing a platform for the world's burgeoning commerce in bitcoins.

The company was conceived in Northern Ireland and is funded by Silicon Valley, with clients including Rakuten - better known as Play.com.

The $14m investment by experienced investors, the private equity fund Highland Capital, marks the largest 'series a' round of funding for an Irish financial technology company.

Bitnet was formed in January by ex-Visa executives John McDonnell and Stephen Mc Namara, who left the company with the idea of developing technology to make it easier for retailers trade in bitcoins.

The firm's staff of just over 30 people overall - 21 of them in Belfast - also include payment industry veterans who managed Cybersource, the world's largest payment gateway, sold to Visa for $2bn (£1.2bn) in 2010.

Chief operating officer Brendan Smyth said the firm's deal with Highland Capital Partners was a "huge opportunity".

"It's very significant for us as we've been going for less than a year and it's a huge endorsement," he said.

He said the endorsement in the firm was testimony to the pedigree of staff, reflecting a technology community in Northern Ireland which was "among the best in the world".

"Numerous people from Silicon Valley tell us this and that's what has impressed our investors: we have a really good talent pool here.

"Every organisation has an objective to put out its stall and hire the right people for that organisation and if you have the right people the organisation will be very successful," he said.

He said though the company has a Belfast headquarters, it owed much to the Californian tech hub in Silicon Valley.

"It's a mix: the money comes from Silicon Valley and the talent's coming from Belfast."

As part of the funding, Peter Bell, partner at Highland Capital Partners, will join Bitnet's board of directors.

Bitcoin is digital cash specifically developed for the internet and can be used to purchase goods online - and even in a select few High Street shops so far - while reducing fraud risks and fees.

Founder John McDonnell added the firm was "building the integrations, systems and technologies that multinational retailers and travel companies need in order to accept bitcoin."

Background

Brendan Smyth, chief operating officer of Bitnet, said that in the first three-and-a-half years of its use from 2009, bitcoin transactions topped £28.7bn.

In comparison, alternative online payment system PayPal had generated £17bn in sales.

"That shows the scale of Bitcoin," he said.

Belfast Telegraph


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