The crypto winter is proving to be a difficult time for investors. However, for those who believe in the technology, it seems that now is the right time to focus their efforts on high-potential investments. Lightspeed Venture Partners, a US VC firm that focuses on fintech, announced the creation of Lightspeed Fraction, a blockchain-focused team to invest in early stage blockchain projects.
Crypto Investments: New Team
This news is in conjunction with Lightspeed Venture Partners’ announcement of three new US funds. These funds total $6.6 billion. A $500 million fund focuses on Indian early-stage startups. The VC firm currently has $18 billion in assets.
According to the firm, the decision to invest big in blockchain companies is consistent with the investment thesis that tech “is changing the way network participants are incentivized and how startups within the ecosystem are funded and how communities can coalesce to create change.”
In 2013, the VC invested in cryptocurrency. Digital assets were viewed as a key technology offering unprecedented opportunities for the “underbanked” or unbanked population around the world. Ravi Mhatre, Lightspeed’s partner, stated:
“We believe that the industry is still in the transition to web3 from web2 and that the collaboration between Lightspeed & Faction is a testimony to our shared belief that cryptocurrency can help develop a web that serves underserved individuals around the globe.
Fundraising in the Bear Market
Crypto-focused VC Multicoin Capital announced that it had raised $430M for its third fund to support blockchain startups. This amount is 4.3x more than the $100M raised for its first fund.
According to media reports, the firm raised the fund in the fourth quarter last year and closed it in January this year. Additionally, companies in the early stages of development are likely to receive between $500,000 and $25 million while projects at later stages would receive $100 million and more.
It is worth noting that Multicoin Capital co-founders, Kyle Samani, and Tushar Jain are the largest limited partners. Samani stated that the current bear markets do not affect the company’s investment strategy in Web3 or blockchain companies.
Samani stated that 3AC, the troubled firm, had a stake in Multicoin Capital’s funds. This raised questions about whether it could have financial stress on the venture.
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