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Blockchain Capital raises $580 million for two crypto funds amid ongoing VC drought: ‘We’ve acquired stuff that’s working’ Acquire US

Blockchain Capital, one of many extra established enterprise capital outfits in crypto, mentioned on Monday that it had raised $580 million for 2 separate funds—one of many largest crypto fundraising bulletins of the yr.

The corporate will allocate $380 million towards what it calls its “early stage” fund, or cash to spend money on seed or Collection A rounds, a spokesperson informed Fortune. And $200 million is for its “alternative” fund that may present capital for a startup’s latter levels of fundraising.

Blockchain Capital, which has invested in crypto for a decade, started elevating capital for the 2 funds within the fourth quarter of 2021, simply earlier than the crypto market started to teeter after which crash months later. The fund elevate formally closed on Monday and was simply $20 million shy of its preliminary $600 million goal, Spencer Bogart, basic associate at Blockchain Capital, informed Fortune. (The agency had deliberate to boost $400 million for its early stage fund and $200 million for its alternative fund.)

Bogart declined to supply the precise share breakdown of the restricted companions, or the traders within the two separate funds, however mentioned that majority is from massive household workplaces, adopted by pensions, endowments, foundations, and different funding companions. Many contributors are repeat traders, he mentioned, and the current market downturn hasn’t scared them off.

“We get very numb to these cycles over time,” he added, “and I believe a variety of them have as nicely.” 

Blockchain Capital’s fund elevate is a blip of hope for blockchain boosters amid a relatively miserable funding panorama for crypto VCs and startups.

Within the first half of 2023, VCs solely invested $2.3 billion into crypto startups, a 75% lower from the identical interval in 2022, in keeping with information from Pitchbook. And as capital has dried up, the runways for some startups, particularly these specializing in non-fungible tokens, have run out.

That doesn’t imply, nevertheless, that restricted companions have shunned crypto. CoinFund, one other crypto VC, announced in July that it had raised $158 million to again blockchain startups. And Fortune reported that Polychain Capital, one other stalwart of the crypto VC panorama, not too long ago had its first shut—of about $200 million—for its fourth fund. Polychain nonetheless plans to boost round $400 million in complete.

Bogart declined to say how a lot Blockchain Capital has raised pre and put up the collapse of FTX. Nonetheless, he did say he and his companions have already got deployed a major quantity of the $580 million they’ve raised—about one third—together with current investments in EigenLabs and RISC Zero.

And, versus some crypto VCs which have turned their heads on a swivel in response to the siren name of AI, Bogart mentioned Blockchain Capital’s focus stays completely on crypto.

“We’ve acquired stuff that’s working,” he mentioned of the crypto , “and much more stuff goes to work.”

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