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Bitcoin Security Startup Raises $12 Million

Hacking to Mine Bitcoin

BitGo, a company that offers a Bitcoin security platform and Bitcoin wallet, today announced that it has raised $12 million in Series A financing led by Silicon Valley venture capital firm Redpoint Ventures.

BitGo has developed a “2-of-3 key” multi-signature Bitcoin wallet in which three keys are issued and any two are required to sign a transaction, whereas most Bitcoin wallets only require one private key, creating a single point of attack.

Silicon Valley-based BitGo offers a platform featuring enterprise-grade security, multi-signature wallets, transaction signing policies, private key generation and management, and robust authentication.

The company has created a range of security products that leverage and strengthen emerging industry standards, including BIP16 (P2SH) and BIP32 (hierarchical deterministic wallets).

The company currently offers an online Bitcoin wallet for individuals, and BitGo Enterprise, a, multi-user solution for corporations and financial institutions to manage their Bitcoin holdings with enterprise-grade security.

The company also enables exchanges, marketplaces, and e-commerce players to use its platform to facilitate secure, multi-party transactions that are secured with BitGo.

“Given a sufficient level of security, Bitcoin is a game-changing technology for global commerce and capital markets,” the company said. “With its decentralized, peer-to-peer ledger of transactions and clearing system, Bitcoin is poised to disrupt traditional payments and money transmission by reducing transaction fees and eliminating fraud and chargebacks. In the developing world, Bitcoin is being adopted as a viable alternative to legacy currencies for storing and transferring wealth.”

“We are still in the early innings of the Bitcoin revolution,” said Will O’Brien, chief executive officer and co-founder of BitGo. “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.”

In addition to the funding news, BitGo announced that Jeff Brody, founding partner of Redpoint, and Stratton Sclavos of Radar Partners will join its board of directors. Sclavos was the CEO of Verisign from 1995 to 2007, and has served on the boards of public companies Intuit, Juniper Networks, and Salesforce.com.

“Bitcoin has opened a new frontier much like the advent of the commercial Internet in 1994,” said Sclavos. “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.”

Previous investors Bridgescale Partners, Jeff Skoll, Bill Lee, and Eric Hahn participated in the round. New investors include Radar Partners, Founders Fund, Barry Silbert’s Bitcoin Opportunity Corp., Liberty City Ventures, Crypto Currency Partners, Ashton Kutcher & Guy Oseary's A-GRade Investments, and a number of top Bitcoin industry executives and angel investors.

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