Bitcoin security platform BitGo raises $12M in funding

Silicon Valley investors back the security startup, which aims to safeguard user accounts with a multi-signature wallet.

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Silicon Valley security firm BitGo is working with new ways to beef up Bitcoin safety to protect the digital currency from cyberthieves and hackers. And, investors appear to be showing their confidence in the company.

BitGo announced Monday that it received $12 million in Series A financing.

"We are still in the early innings of the Bitcoin revolution," BitGo CEO and co-founder Will O'Brien said in a statement. "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."

BitGo's security platform aims to safeguard users' bitcoins with a "2-of-3 key" multi-signature Bitcoin wallet, which requires users to sign at least two of three keys to carry out a transaction.

Over the past couple of years, virtual currencies have been gaining more acceptance -- transforming from an obscure idea into a possible payment mechanism. However, the road has been rocky. Bitcoin, the most popular of digital currencies, has seen its value surge and plummet and regulators applaud and dismiss it.

Earlier this year, Tokyo-based Mt. Gox filed for bankruptcy after it was revealed that hackers stole nearly $500 million in bitcoins through a weakness in the company's system. Bitcoin bank Flexcoin also announced it was shutting down after being hacked this year.

Despite these setbacks, entrepreneurs and venture capitalists clearly still see a strong role for Bitcoin.

BitGo's financing was led by Redpoint Ventures, and also included funding from Bridgescale Partners, 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 several individual investors.

 

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