Andreessen Horowitz raises $4.5bn for its crypto fund
VC firm Andreessen Horowitz has formed a new crypto investments fund despite the market witnessing a downturn
By Shashank Bhardwaj
The new fund is the fourth in the line of funding initiatives taken by a16z to target digital assets in particular. $7.6 billion has been raised in total to finance these funds. Of the total $4.5 billion, $1.5 billion will be directed towards seed investments, and the rest $3 billion, will be kept for venture investments. Previously, the firm had raised funds in June 2021 and April 2020. Both these happened shortly after market downturns, too.
A16z stated in the announcement that the company was ‘excited’ about the developments happening in blockchain gaming, decentralised social media, Defi, and non-fungible tokens (NFTs).
A16z’s partners Arianna Simpson and Chris Dixon commented on the long-term opportunity in crypto and compared it to “the next major computing cycle”, such as that of the PCs in the 1980s, the internet in the 1990s, and mobile phones in the early 2000s.
“Bear markets are often when the best opportunities come about when people are actually able to focus on building technology rather than getting distracted by short-term price activity,” Arianna Simpson said.
Bitcoin is down by 56 percent from its November all-time high (ATH), and altcoins are also facing the wrath of the bear market phase, having slipped drastically from their ATHs. Cryptos continue showing a high correlation to stocks which have undergone a major slump this year. The Terra-Luna crash in early May also acted as a trigger for the downturn and lack of positive investor sentiment. But Simpson seemed unfazed and said that investors needn’t worry about the firm’s prospects.
She added, “The technical diligence and the other kinds of diligence that we do are a key part of making sure that projects meet our bar. While our pace of investment has been high, we continue to invest really in only the top echelon of founders.”
The writer is the founder at yMedia. He ventured into crypto in 2013 and is an ETH maximalist. Twitter: @bhardwajshash
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