BitAngels invests $5 million in Mastercoin an open-source platform that is building a protocol layer on top of Bitcoin, in order to provide users with a number of important features which Bitcoin itself lacks, including virtual assets, a distributed exchange, and contracts for difference. Fifty BitAngel angels participated in the investment, with David Johnston being one of the largest investors. He now sits on Mastercoin’s board of directors.
Terpin: We’re looking for investments that can sort of act as insurance for the price of Bitcoin, because if you don’t have companies growing the infrastructure, the price of Bitcoin is never going to get from $1,000 to $10,000 to $100,000.
As well, we’re looking for things that are going to make it sexy for average consumers and easy for merchants to use. The single biggest thing that sustains long-term value is adoption. If there are 10 times the number of people using Bitcoin, or 10 times the trading volume, or some combination thereof, the price has historically gone up in correlation to that.