Venture Capitalist Tim Draper Bets $400,000 on Bitcoin Revival

| Updated
by Polina Chernykh · 3 min read
Venture Capitalist Tim Draper Bets $400,000 on Bitcoin Revival
Photo: JD Lasica/Flickr

Venture capitalist Tim Draper recently wagered about $400,000 that Bitcoin will rebound from its recent plunge.

Tim Draper, an American VC investor and a founder and director of Draper Fisher Jurvetson, recently wagered about $400,000 that bitcoin price will recover from its recent price drop.

Mr. Draper told Bloomberg that last week he purchased 2,000 bitcoins for ‘around $200’. Mr. Draper, who won the biggest part of Silk Road auctions of bitcoin organized by U.S. government  in 2014, is sure the cryptocurrency will bounce back after its value fell by 70% during the last year.

Within a two-day period this year, from January 13th to 14th, Bitcoin’s price decreased by over 30% , falling to about $170 level. Some analysts started arguing about the bitcoin’s future, given the increasing regulation and serious price drop. Against this background, bitcoin was called one of the worst investments of 2014, even worse than oil or the Russian ruble.

On Wednesday morning, January 28th, 2015, Bitcoin was valued at about $258 compared with more than $1,100 in October 2013.

Tim Draper won 2,000 bitcoins at the auction organized by the US Marshals Service in December, 2014. In general, the agency auctioned 50,000 bitcoins that were confiscated from the Silk Road marketplace. The bitcoins were seized from the computer hardware of Silk Road’s creator Ross Ulbricht in October 2013.

At the previous auction, which was held by the U.S. Marshals Service this summer, all the 30,000 bitcoins auctioned by the government were acquired by Draper. The sum of the bid was not revealed.

Adam Draper,  Tim Draper’s son, is also a prominent figure in the bitcoin industry.  In 2012, he founded Boost VC, a San Mateo-based accelerator of bitcoin startup companies. In addition, Adam Draper has invested in a number of companies, including Coinbase, MinoMonsters and Practice Fusion, and is also a member of the board of directors at four companies.

In March 2014, Adam told Coindesk that Boost VC wanted to contribute to the growth of  the digital currency industry by accelerating 100 bitcoin companies. He said: “We are actually, over the next three years, going to be accelerating 200 companies. And 100 of those are going to be bitcoin companies. That’s our big stake in the ground.”

Adam Draper, is a fourth-generation venture investor. Draper is not afraid to take risks, considering the fact his father’s company DFJ that was the first firm to “only back Internet companies” became very successful.

Technology is one of the most rapidly developing industries today. Even though Draper’s father Tim Draper was a pioneering venture investor in the early years of the Internet, Draper admitted that opening a company now is different than it was years ago: “It’s crazy how much things have changed in such a short amount of time. If you want to start a business today, all you need is $80, a bank account and some code.”

Since the launch of Boost VC in 2012, the company has accelerated more than 40 startups over three sessions.  Draper said that the first session attracted almost 70 candidates, while the second session had a bigger number of applicants and by the third session Boost VC had 500 startups that applied for the program.

Draper said: “When we announced our plans to accelerate 100 bitcoin companies, there was a huge response from the community. It showed us just how much interest people have in this space, and also how disruptive this technology really is.”

Bitcoin News, Cryptocurrency News, Editor's Choice, Internet of Things News, News
Polina Chernykh

Polina is an undergraduate student at Belarusian State Economic University (BSEU) where she is studying at the faculty of International Business Communication for a degree specializing in Intercultural Communication. In her spare time she enjoys drawing, music and travelling.

Related Articles