The year 2014 is often remembered as a turbulent period for Bitcoin—marked by a dramatic price decline and the infamous collapse of the Mt. Gox exchange. At first glance, it might seem like a failed year for cryptocurrency investors. However, a deeper analysis reveals a more nuanced picture. While the price of Bitcoin fell sharply, key indicators of economic growth within the ecosystem continued to strengthen. This article explores the real story behind Bitcoin’s development in 2014, focusing on infrastructure expansion, venture capital interest, business formation, job creation, and underground market activity.
By looking beyond price alone, we uncover a resilient and evolving digital economy that laid critical foundations for future adoption.
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Venture Capital Investment in Bitcoin Infrastructure
Despite the bearish sentiment surrounding Bitcoin’s price throughout 2014, investment in its underlying infrastructure saw consistent growth. According to data from BitcoinPulse, the number of angel investors listing Bitcoin as an area of interest increased steadily over the year.
BitcoinPulse defines a "Bitcoin investor" as an angel investor who includes “Bitcoin” on their “What would you like to invest in?” list. The statistics reveal a clear upward trend:
Weekly Growth in Bitcoin Investors:
- Past 7 days: +0.47%
- Past 30 days: +0.62%
- Past 90 days: +0.56%
- Past 180 days: +0.71%
- Past 365 days: +0.72%
Monthly Growth in Bitcoin Investors:
- Past 30 days: +2.69%
- Past 90 days: +2.41%
- Past 180 days: +3.08%
- Past 365 days: +3.12%
The absolute number of Bitcoin-focused investors reached 1,911 by late December 2014.
This sustained rise in investor interest indicates growing confidence in Bitcoin’s long-term potential—even amid short-term volatility. Rather than signaling collapse, the dip in price may have represented a market correction, filtering out speculation and attracting serious players focused on building lasting value.
Expansion of Bitcoin-Based Companies
Parallel to rising investment interest, the number of companies operating within the Bitcoin space expanded significantly in 2014.
BitcoinPulse tracked startups categorized under the "Bitcoin" market on AngelList (now Wellfound), defining them as “companies listed on AngelList that identify with the Bitcoin sector.”
The data shows robust growth:
Weekly Growth in Bitcoin Companies:
- Past 7 days: +1.79%
- Past 30 days: +1.47%
- Past 90 days: +1.67%
- Past 180 days: +2.59%
- Past 365 days: +3.14%
Monthly Growth in Bitcoin Companies:
- Past 30 days: +6.44%
- Past 90 days: +7.34%
- Past 180 days: +11.6%
- Past 365 days: +14.18%
The total number of active Bitcoin-related companies reached 512 by year-end.
This surge reflects increasing entrepreneurial confidence and signals maturation in the ecosystem. New businesses were emerging not just in trading and wallets, but also in payments, compliance, analytics, and decentralized applications—laying the groundwork for broader adoption.
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Growth in Bitcoin-Related Job Opportunities
With more companies entering the space, demand for skilled professionals naturally followed.
Using the same AngelList dataset, BitcoinPulse measured job postings tagged under the "Bitcoin" market, defined as “roles listed by companies that fall into the Bitcoin category.” It should be noted that these roles do not necessarily pay in Bitcoin—many are compensated in fiat currency.
Job growth trends show mixed short-term performance but strong annual momentum:
Weekly Growth in Bitcoin Jobs:
- Past 7 days: -2.34%
- Past 30 days: -0.37%
- Past 90 days: +1.59%
- Past 180 days: +1.46%
- Past 365 days: +1.98%
Monthly Growth in Bitcoin Jobs:
- Past 30 days: -1.57%
- Past 90 days: +7.01%
- Past 180 days: +6.43%
- Past 365 days: +8.76%
The total number of listed Bitcoin-related positions stood at 125.
While monthly figures dipped slightly at year-end, the full-year trajectory remains positive. Additional platforms such as Coinality and Reddit’s r/Jobs4Bitcoins—which weren’t included in this dataset—reported significant increases in job listings throughout 2014, suggesting even stronger underlying demand.
Moreover, the global rollout of Bitcoin ATMs accelerated, growing at an average rate of 8.39% per month. By December 2014, there were 331 operational Bitcoin ATMs worldwide, enhancing accessibility and signaling real-world integration.
Underground Market Activity and Transaction Volume
A controversial yet undeniable component of Bitcoin’s usage in 2014 was its role in darknet markets.
Though often overlooked or dismissed due to legal and ethical concerns, these platforms contributed significantly to transaction volume and network activity. Government crackdowns—such as Operation Onymous, which targeted Silk Road 2.0—raised the risks of operating on darknet markets.
Some analysts argue this contributed to declining demand for Bitcoin and thus lower prices. However, evidence suggests these disruptions had limited long-term impact.
An interview with the administrator of DeepDotWeb, a leading darknet news site, revealed key insights:
“Operation Onymous failed to meaningfully disrupt the ecosystem because:
- Only one major market (Silk Road 2.0) was taken down; others remained untouched.
- Users simply migrated to new platforms—a pattern repeated since the original Silk Road shutdown.
- Some sites disappeared due to scams (e.g., Pandora) or fake takedowns—ironically helping clean up fraudulent actors.
- Copycat sites emerged rapidly, increasing user confusion but also resilience.
- Media coverage often drives more traffic than enforcement deters.”
He emphasized that darknet markets remain a core driver of Bitcoin transaction volume, especially when considering activities like:
- Money laundering via decentralized networks
- Online gambling
- Forex and speculative trading
- Exchange volume (which often serves other use cases)
- Limited merchant adoption (e.g., Overstock sales represent a tiny fraction of total volume)
In essence, much of Bitcoin’s most active usage occurred off public radar—highlighting a disconnect between price and real-world utility.
Frequently Asked Questions (FAQ)
Q: Was 2014 a bad year for Bitcoin?
A: Not necessarily. While the price dropped significantly, fundamental growth in investment, company formation, jobs, and infrastructure suggests long-term strengthening.
Q: Did Mt. Gox cause Bitcoin’s price crash?
A: The Mt. Gox collapse contributed to panic and loss of trust, but broader market correction and increasing supply also played major roles.
Q: Are darknet markets important for Bitcoin’s economy?
A: Yes—they drove substantial transaction volume in 2014, though their influence has decreased over time as legitimate use cases expanded.
Q: How many Bitcoin companies existed in 2014?
A: Around 512, according to AngelList data compiled by BitcoinPulse—a 14% increase from the previous year.
Q: Did venture capital support decline during the bear market?
A: No—angel investor interest grew steadily throughout 2014, reaching over 1,900 investors, indicating strong foundational support.
Q: What does this mean for future investments?
A: It shows that innovation often thrives during downturns. Early investors who focus on ecosystem health rather than short-term price may find strategic opportunities.
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Conclusion
Labeling 2014 as “Bitcoin’s worst year” oversimplifies a complex reality. While prices declined sharply—partly due to exchange failures and market corrections—the underlying economy grew substantially.
From venture capital inflows and startup formation to job creation and infrastructure deployment, multiple indicators point to resilience and maturation. Even controversial uses on darknet markets underscored Bitcoin’s utility as a global, censorship-resistant currency.
Ultimately, price is just one metric—and not always the most telling one. The true story of 2014 is one of quiet foundation-building, setting the stage for wider adoption in the years ahead.
For investors and enthusiasts alike, this serves as a powerful reminder: innovation doesn’t pause during bear markets. In fact, it often accelerates.
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