Blockchain Capital, one of the more established venture capital outfits in crypto, said on Monday that it had raised $580 million for two separate funds—one of the largest crypto fundraising announcements of the year.
The company will allocate $380 million toward what it calls its “early stage” fund, or money to invest in seed or Series A rounds, a spokesperson told Fortune. And $200 million is for its “opportunity” fund that will provide capital for a startup's latter stages of fundraising.
Blockchain Capital, which has invested in crypto for a decade, began raising capital for the two funds in the fourth quarter of 2021, just before the crypto market began to teeter and then crash months later. The fund raise officially closed on Monday and was just $20 million shy of its initial $600 million target, Spencer Bogart, general partner at Blockchain Capital, told Fortune. (The firm had planned to raise $400 million for its early stage fund and $200 million for its opportunity fund.)
Bogart declined to provide the exact percentage breakdown of the limited partners, or the investors in the two separate funds, but said that majority is from large family offices, followed by pensions, endowments, foundations, and other investment partners. Many contributors are repeat investors, he said, and the recent market downturn hasn’t scared them off.
“We get very numb to those cycles over time,” he added, “and I think a lot of them have as well.”
Blockchain Capital’s fund raise is a blip of hope for blockchain boosters amid a comparatively depressing funding landscape for crypto VCs and startups.
In the first half of 2023, VCs only invested $2.3 billion into crypto startups, a 75% decrease from the same period in 2022, according to data from Pitchbook. And as capital has dried up, the runways for some startups, especially those that specialize in non-fungible tokens, have run out.
That doesn’t mean, however, that limited partners have shunned crypto. CoinFund, another crypto VC, announced in July that it had raised $158 million to back blockchain startups. And Fortune reported that Polychain Capital, another stalwart of the crypto VC landscape, recently had its first close—of about $200 million—for its fourth fund. Polychain still plans to raise around $400 million in total.
Bogart declined to say how much Blockchain Capital has raised pre and post the collapse of FTX. However, he did say he and his partners already have deployed a significant amount of the $580 million they’ve raised—about one third—including recent investments in EigenLabs and RISC Zero.
And, as opposed to some crypto VCs that have turned their heads on a swivel in response to the siren call of AI, Bogart said Blockchain Capital’s focus remains exclusively on crypto.
"We've got stuff that's working," he said of the crypto , "and a lot more stuff is going to work."
