Blockchain Coinbase Bitpay Xapo Circle – The Bitcoin Stack Is Forming

Its never a dull day in Bitcoin land.

For a while we had two well-funded major ventures that seemed to be running neck and neck – Coinbase and Bitpay. I saw them mainly as payment processors for merchants, which I covered in this post.

Then during the dog days of summer, there was a big $40m round for Xapo.

Then just recently, Blockchain raised $30m after having bootstrapped since the early days. I imagine that the $40m Xapo round may have influenced them.

Funding is a lousy proxy for traction, but until these ventures go public and we can sift through the S-1 docs, funding is the best proxy that we have. So here is a ranking by money raised (data from Crunchbase):


Xapo $60 Million


Bitpay $32.5 Million


Coinbase $31.7 Million


Blockchain $30.5 Million


Circle $26 Million


I then attempted to put them into categories. This is where the lines can get a bit more blurry. I created three categories – Payment Processor, Wallet, Universal Bank.

Payment Processor. These are vying to be the Visa/Mastercard/Amex of the Bitcoin business. By number of merchants enrolled, these two are neck and neck:




Wallet. These are vying to be the bank that consumers trust to store their Bitcoin money. This puts them in the regulatory cross hairs and they have to spend to get security right.





“Universal Bank”. These are ones that cross boundaries. Like Banks that offer everything from retail savings accounts to derivatives trading, which we call Universal Banks.


Coinbase makes it easy for people, businesses, and develoeprs to use Bitcoin. – this is on Crunchbase

Coinbase is the world’s most popular bitcoin wallet. We make it easy to securely buy, use, and accept bitcoin currency.



Circle. Their description is vague:

Circle is a digital currency company that makes it easy to exchange, store, send and receive Bitcoin – this is on Crunchbase

We make using money instant, secure, and free. The way money should be. This is on Circle’s site.


There are two truisms about technology transitions:


  1. New technology changes existing categories. Categories like Wallet and Payment Processor may simply be hangovers from the previous generation and no longer useful as categories or analogies. This argues that the Universal approach is right.
  2. Focus always wins and therefore new technologies always form into stacks.


I incline to the second view. Categories don’t matter – they are labels for analysts and investors. However customer focus matters. Payment Processors are focused on serving Merchants and Wallet providers are focused on serving Consumers.


I think we are seeing a Bitcoin stack emerging.








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