Bitcoin companies may have already hit their peak.
Venture fundraising in the bitcoin-related space has fallen sharply from the first quarter high, with big banks on Wall Street now looking to develop technology in-house rather than putting money to work in the space.
“Unfortunately, many banks and institutions have focused on the creation of their own blockchains instead of innovating on the bitcoin blockchain,” Michael Sonnenshein, director of sales and business development at Grayscale Investments, told Business Insider.
One of the high-profile startups running into difficulty raising new capital is Blythe Masters’ blockchain startup, according to a report in the New York Times.
Digital Asset Holdings, a blockchain company providing distributed ledger and settlement services, has struggled to raise new funds, even after appointing Masters earlier this year.
Digital Asset Holdings and Masters reportedly suffered after giving “better terms” to Masters’ former employer, JPMorgan, than it is currently offering other banks like Citigroup and Goldman Sachs, according to The New York Times report.
One of the difficulties facing Digital Asset, the Times reports, is that the bitcoin and blockchain industry has been flooded with numerous startups directly competing with each other. Then there are projects like R3,which is looking to develop common standards and use cases for blockchain and now has 42 banks signed up.
Digital Asset Holdings declined to comment when contacted by Business Insider.
Since hitting a recent peak in the beginning of 2015, investing in the bitcoin and blockchain space has experienced a drop-off in investor interest, according to data maintained and published by CB Insights.