The crypto venture space has been thrown for a major loop as the world’s largest crypto exchange Binance first signed a letter of intent to buy rival FTX, which had rapidly crumbled in a wild bank-run-like liquidity crunch, and then just one day later, the deal fell through, with Binance backing out. But the outcome might not matter: Crypto VC has been shaken to its core.
“The narrative is just so negative, and will be for a while now,” says David Pakman, managing partner at crypto-focused firm CoinFund, which owns a small stake in FTX (CoinFund’s investment was made before he joined the firm in 2021 from traditional tech VC firm Venrock, he says).
