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- Crypto sphere is going through a heavy downfall, or as experts say it, a crypto bloodbath, causing havoc in the prices of digital assets.
- Recently, a16z made an announcement to raise a $4.5 Billion crypto fund. Although not too many details were unveiled regarding the plan.
- As of this writing, the cryptocurrency market was having a total market cap of $1.3 Trillion, with Bitcoin and Ethereum dominating the market.
The Mammoth Fund
This month has not been very kind to the cryptocurrency market. Constant weeks of crypto bloodbath have left whispers to “buy the dip” going cold as the big gunns in the sector buckle down for winter.
A relieving moment came for a shorter time frame though, when a16z made the announcement to raise a cryptocurrency fund worth $4.5 Billion, double than the former fund it raised.
It is the greatest institutional crypto organization to this date and comes at an interesting time.
While venture Capitalist firms all across the globe have been pressing their portfolio organizations to cut burn rates and buckle down for the tough times, several cryptocurrency founders were already braced for this moment, having jacked up ridiculous amount of funds from VCs solely for the motive of not having to pile up cash later.
While tech widely have not suffered a recession since early 2000s, digital asset startups have endured healthy windows of bust and boom.
In spite of several coffers being full, it is fair to assume that crypto winter is likely to put several venture backed startups on ice.
Andreessen Horowitz did not let several details roll out regarding this fund, but it did interestingly detail that they are planning to dedicate at least $1.5 Billion from this fund to seal the deals. That’s a hell of a lot of seed deals.
The question remains if the venture ecosystem around cryptocurrency sticks around. Several hedge fund freshers in the market have gotten burned and other conventional venture organizations appear to sheeply poke their heads into this pattern and might be nearing the door.
For a market that is going through this massive havoc, frothing with dumb money for past couple of years, any kind of pullback is gonna leave startups in a lurch.
Andreessen Horowitz’s concentration on young organizations with their latest fund might be tough for firms looking for their growth in dollars.
Anurag is working as a fundamental writer for The Coin Republic since 2021. He likes to exercise his curious muscles and research deep into a topic. Though he covers various aspects of the crypto industry, he is quite passionate about the Web3, NFTs, Gaming, and Metaverse, and envisions them as the future of the (digital) economy. A reader & writer at heart, he calls himself an “average guitar player” and a fun footballer.
