BitInstant
BitInstant was a Bitcoin company in the Exchanges category, founded in 2011 by Charlie Shrem, Gareth Nelson.
The Idea
A service that let users quickly purchase Bitcoin through cash deposits at thousands of retail locations (like CVS and Walmart), dramatically reducing the friction of acquiring BTC in the early days when exchange onboarding took weeks, and payments were often rejected.
Early Traction
Rather than waiting sometimes weeks for money to land in an overseas exchange users may not be familiar with, it allowed users to buy Bitcoin with cash. Backed by the Winklevoss twins as one of the first VC investments in the industry.
Peak Stats
30% of all BTC network transactions at peak.
Status Today
Shut down in July 2013. In January 2014, Shrem was arrested at JFK Airport and charged with money laundering related to Silk Road transactions due to improper KYC.
Why It Matters
BitInstant was the Winklevoss twins' first Bitcoin bet and represented the earliest wave of VC interest in the space. Its collapse underscored the regulatory risks that defined the early era.