Crypto VCs are back in action amid a market rally.
Venture capital (VC) funding rounds are increasing as the crypto bull market is back firing on all cylinders.
On May 16, crypto venture firm Aquarius announced the launch of a $600 million multistrategy liquidity fund to help blockchain foundations and ecosystem projects increase liquidity on-chain. In a statement to Cointelegraph, Aquarius employees mentioned that the strategic fund is supported by “Bitrise Capital, various leading miners, family offices and influencers”.
In addition, the $600 million strategic fund will help blockchain infrastructure, decentralized finance, artificial intelligence, bitcoin (BTC) ecosystem, modular architecture and first-stage data layer projects build their communities along with developing products to market. “As the first institutional fund of its kind, it will strategically manage on-chain liquidity and help various blockchain foundations and ecosystem projects meet their liquidity needs,” wrote Aquarius.
Aquarius It was founded in 2018 by Singapore-based venture capitalist Lin Yang, who has backed notable projects such as Conflux, as well as investments in Web2 sectors including new energy, advanced manufacturing and finance. The company moved its headquarters to New York on May 8.
Meanwhile, as the bull market heats up, crypto ecosystem projects are receiving significant funding.
On May 6, Cointelegraph reported that crypto VC funding topped $1 billion for the second consecutive month this year. April saw $1.02 billion in funding across 161 investment rounds, compared to $1.09 billion in March, both trends not seen since the end of 2022.
Earlier this month, digital securities platform Securities raised $47 million in a new strategic funding round led by BlackRock. Blockchain developer Aptos Labs was also among the investors, alongside Stalkcoin issuers Paxus and Circle. Joseph Chalom, BlackRock's global head of strategic ecosystem partnerships, will join Securitize's board of directors. He described the investment as “another step in the evolution of our digital asset strategy […] This will help to meet the future needs of our customers.
In April, Puffer Financial, a liquid stack project built on top of Ethereum layer-2 solution EigenLayer, secured $18 million in Series A funding from mainnet startups such as Coinbase Ventures and Kraken Ventures. Puffer Finance's technology allows Ethereum validators to reduce their initial capital requirement to just 1 Ether (ETH), down from the 32 ETH required for individual stakeholders. Shortly after the protocol's launch in February, it surpassed the total price locked in at $1.4 billion.
The market has changed dramatically from a year ago.
In September 2023, Tony Cheng, a partner at Singaporean crypto investment firm Foresight Ventures, advised projects to do their best to survive. “If you're short of capital, if you don't have a runway to get you through the next year or so, you've got to take as much capital as you can because the money may not be available anymore. Maybe two or three months,” he explained at the time.
In the year Since the sudden fall of the cryptocurrency exchange FTX to below $16,000 in November 2022, Bitcoin has gained more than 300%, due to the fact that funds trading on Bitcoin exchanges around the world and creditors have gradually been paid back on the lost exchange. Some VCs are predicting that the current bull market will see another initial coin that surpasses the highs of early 2018.
Related: Crypto VC Funding Grows 53% in March, Optimism Wins Largest Share
