Bitcoin’s whiplash-inducing volatility continued this week when the cryptocurrency surged to new two-year highs on Monday before plunging 10 percent the following day. One of the major drivers of Bitcoin’s recent rise has been demand from China.
A group of Chinese companies, including Internet search giant Baidu Inc (ADR) BIDU, has raised $60 million in funding for Circle Inc, a U.S. startup based on Bitcoin’s underlying technology.
Circle is a blockchain-based digital payment app. Blockchain technology is the public ledger of all Bitcoin transactions and is often viewed as the major underlying innovation of Bitcoin.
“If you look at the trends, China very well could be the driver of the adoption of blockchain consumer services,” Circle CEO Jeremy Allaire said.
One potential hurdle Circle and other blockchain-based startups may soon have to clear is potential patent disputes. Australian Craig Wright, who claims to be Bitcoin founder “Satoshi Nakamoto” has now filed at least 50 patent applications via Britain’s EITC Holdings Ltd.
The London Review of Books claims that Wright is in the process of filing hundreds of patents that will eventually be sold for more than $1 billion.
In the meantime, Circle and its investors will continue to try to apply blockchain technology toward Allaire's goal of building a global bank that makes sending payments “as easy as sending an email.”
Disclosure: The author holds no position in the stocks mentioned.
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