Li Ka-shing attends a press conference in Hong Kong, Aug. 4. (Photo/CFP)
Controversial virtual currency bitcoin has received a strong validation from Asia's richest man, Li Ka-shing, who has made an investment in BitPay, an Atlanta-based startup aiming to become the world's largest bitcoin payment service provider, reports the state-owned China News Service.
The 85-year-old Hong Kong business magnate, the world's eighth richest man based on Forbes' latest rich list with net assets of US$31 billion, invested in BitPay through his venture capital company Horizon Ventures, which has previously made early investments Facebook and Skype. A spokesperson for Horizons Ventures said the group would not comment on the details of the investment.
In a statement, BitPay said it was "fortunate to have the benefit of many supportive investors, including Horizons Ventures."
Gunning to be the PayPal for virtual currencies, BitPay was founded in May 2011 and currently handles transactions for more than 15,000 companies across 200 countries, about half of which are in the United States. This year the company has processed over US$100 million in transactions.
Bitcoin, the world's leading virtual currency, has come under fire after Chinese and Indian regulators recently issued warnings against using it and China's leading bitcoin exchanges banned yuan deposits.
The digital currency became popular on the mainland as it enables people to sidestep government controls on the movement of capital across national borders. The ban caused the value of bitcoin to plunge from highs exceeding US$1,200 in early December to lows of US$330, though the virtual currency has now settled to around US$725. One bitcoin was valued at just US$14 a year ago.
John Greenwood, the London-based chief economist at Invesco, says bitcoin is not credible as a global currency for three fundamental reasons: it is not an effective medium of exchange for a wide range of goods and services; it cannot act as a long-term store of value or be used for the settlement of long-term contracts; and it cannot be a universal unit of account.
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Li Ka-shing 李嘉誠
