Bitcoin might steal the limelight when it comes to virtual currencies, but it’s also experienced a spate of bad press lately. Japanese exchange Mt. Gox declared bankruptcy, Bitcoin bank Flexcoin shut down, and BitInstant CEO Charlie Shrem was arrested on money-laundering charges. With all this tumult, some entrepreneurs are hedging on another digital currency ecosystem: Ripple.
On Wednesday, CrossCoin Ventures launched an accelerator that will fund companies that work to advance the Ripple ecosystem. “We’re welcoming applications from a wide range of entrepreneurs and developers who will help grow the Ripple ecosystem in some way,” said CrossCoin managing partner Gary Kremen in a statement.
The firm will fund accepted startups with up to $50,000 in XRP, Ripple’s native currency, in exchange for a 3% to 6% stake in diluted common stock. Mentorship and support will be provided by CrossCoin and Ripple Labs, which developed the Ripple protocol and payment system. CrossCoin doesn’t have a set number of startups it will accept, but will review applications as they come in.
“With digital currencies, the cat is out of the bag, and it is unlikely that the world will ever return to a 20th-century era of paper money and plastic credit cards. The future is digital money on smartphones,” Kremen told Fast Company.
Kremen cited near instantaneous transactions as well as the ability to support fiat and virtual currencies on a single protocol as advantages of Ripple’s ecosystem. Though the timing for this launch seems to suggest CrossCoin is capitalizing on Bitcoin’s recent troubles, Kremen said the firm remains bullish on the future of Bitcoin and that Mt. Gox’s woes stemmed from mismanagement and lack of transparency–“not as a problem with the core protocol.”