Blockchain Investment in First Six Months of 2018 Exceeds 2017 Annual Total

The Pulse of Fintech 2018, KPMG | July 31, 2018

In the Pulse of Fintech, KPMG wrote:

Blockchain investment exceeds 2017 annual total

In the first half of 2018, blockchain investment in the US exceeded the total investment seen in 2017, led by $100 million+ funding round to Circle Internet Finance. A number of other significant blockchain deals also occurred during Q1 and Q2’18, including Paxos’ $65 million Series B raise aimed at helping it scale operations for delivery of its blockchain platform.

Based on our experience, the rapid growth in blockchain investment overall can likely be attributed to a number of factors — including the widespread applicability of blockchain to help harness efficiencies within financial institutions. Blockchain’s capabilities extend from record keeping and the registration of transactions to documentation management and supply chain management. While it has primarily been looked at from a banking and insurance point of view to date, the reality is blockchain opportunities abound and could enhance processes for any number of US and global businesses.

Safwan Zaheer, Director of KPMG in the United States’ Financial Services Digital & US Fintech, added:

“There’s more VC flow available than opportunities to invest—a sign of tremendous growth in the space. In particular, investments in blockchain doubled the first half of 2018 compared to 2017. Blockchain has the potential to transform banking and if banking systems were to be rewritten today they would be based on blockchain.”

…Looking ahead, the future continues to look bright for the US fintech market. We anticipate blockchain, regtech and insurtech are all expected to gain momentum, even as AI and RPA continue to drive cross sector opportunities. We will also likely start to see a continued emphasis on partnering, with retailers and aggressive tech leaders globally developing relationships with fintechs in order to steal a piece of the lucrative fintech value chain.

The report can be downloaded here.