Andreessen Horowitz plans a $ 1 billion cryptocurrency fund



Andreessen Horowitz, one of Silicon Valley’s highest-profile venture capital firms, seeks to raise a fund of up to $ 1 billion to invest in cryptocurrencies and cryptocurrency companies, following the success of its investment in Coinbase.

According to four people with knowledge of the process, the new fund, the third of Andreessen, focused on investments in cryptocurrencies, aims to raise between 800 and 1 billion dollars from investors.

This would make it one of the largest capital funds dedicated to cryptography and potentially twice the size of its predecessor. The firm declined to comment.

The boost in Andreessen’s fundraising comes as other cryptocurrency investors are raising large chests of war, spurred on by a growing market for bitcoins, ethereum and other digital assets.

Cryptocurrency venture capitalists have begun making profits from Coinbase, the digital currency exchange that was made public earlier this month and is currently valued at nearly $ 60 billion, and direct investment in virtual currencies. which have increased in value over the last 12 months.

These returns have encouraged institutional investors, such as endowments and foundations, to renew their bets on emerging technologies, despite the uncertain regulatory environment for large areas of the market.

Pantera Capital, one of the first cryptocurrency investment companies, aims to raise $ 600 million for a new blockchain fund that combines investments in private companies and negotiable tokens. has said.

Pantera’s latest venture fund raised $ 175 million in 2018 and, according to its report, was worth 3.8 times that amount website.

Last month, investors including Sequoia Capital China pledged $ 225 million with the second cryptocurrency fund raised by Dragonfly Capital, more than double the amount Dragonfly raised for its 2018 debut version.

Andreessen’s fundraising would rival the capital raised by Paradigm, a cryptocurrency investment company created by Coinbase co-founder Fred Ehrsam and former Sequoia Capital partner Matt Huang in 2018.

According to PitchBook data, Paradigma has raised a total of $ 1 billion from investors, including endowments from Harvard and Yale universities. The company invests from a free capital fund structure that does not require it to return capital on a fixed date.

Coinbase’s direct listing on the Nasdaq stock exchange this month came as a big surprise to early investors and employees, who have tried to reinvest their profits in new companies. The company’s market value reached $ 75.9 billion in initial operations, although it has shrunk by approximately 20% as private shareholders unloaded their stakes.

Founded in 2009 by Marc Andreessen and Ben Horowitz, Silicon Valley-based Andreessen Horowitz was an early investor in cryptocurrency groups, including Coinbase and Ripple, through its traditional funds.

Andreessen’s stake in Coinbase has been one of its biggest successes and was worth $ 11.2 billion at the price of the stock exchange’s first trades. The firm has sold about $ 120 million in shares since Coinbase went public, according to regulatory statements.

After raising his first cryptocurrency fund in 2018, Andreessen became a major investor in so-called decentralized financing projects and was one of the founding members of the Facebook-backed Libra project, now known as Diem.

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Andreessen became a registered investment advisor in 2019, a regulatory distinction that gave him more flexibility when it comes to investing in cryptocurrencies and other assets that hedge funds typically do not have the ability to hold on to. large quantities. The firm managed $ 35.8 billion in regulatory assets at the end of last year, according to a filing.

At the top of its fundraising range, Andreessen’s third cryptocurrency fund would be nearly twice the size of its latest vehicle, which raised $ 515 million a year ago.


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