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After an aggressive start to 2015, venture capital flowing into bitcoin startups has slowed substantially. The $85 million in bitcoin investments in the third quarter represents only a modest 15 percent increase from a year earlier and a 41 percent drop from the previous quarter.Bloomberg believes that a declining bitcoin price and a lack of consumer adoption for online purchases has contributed to the capital slowdown.
Terpin’s faith hasn’t wavered, and he said a slowdown isn’t cause for alarm. “The rate of growth is slowing, and that’s not a surprise,” Terpin said. “For the most part, we are seeing a mild hiccup.” He compared bitcoin to the dot-com bubble but said we aren’t on the verge of bursting, at least not yet. “Nothing goes up forever,” Terpin said. “I don’t think we are in a 2001 crash moment in bitcoin. We are in the 1997 inflection point.” Garzik is similarly committed to bitcoin. His satellite project has a potential customer who may place an $18 million order in March 2016, which could revive the company. In the meantime, Garzik is working on a new startup called Bloq, which is exploring ways for “professionalizing the entire bitcoin ecosystem.” He described it as “a more—ahem—down-to-earth bitcoin company.”
http://www.bloomberg.com/news/articles/2015-10-26/the-bitcoin-startup-boom-comes-back-down-to-earth
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