Blockchain innovators are drawing in rounds of venture capitalists who are betting big on cryptocurrencies and the rise of digital assets. Ratcheting up support for crypto-based startups, a flurry of high-profile investments from big players, such as Polychain Capital, Pantera and Peter Thiel are establishing the sector as a hot target.
While blockchain remains the most coveted skillset on the planet, developers worldwide are focusing on building sophisticated infrastructure and onramps that will give users an easy way to adopt digital assets such as Bitcoin, Ethereum, XRP, Bitcoin Cash, Litecoin and stablecoins, as well as introduce people to emerging platforms that use digital tokens for customer loyalty points and rewards.
Enter Polychain Capital. According to an investor slide deck, the crypto investment firm is gearing up for its second crypto venture capital fund, reports CoinDesk.
The company plans to raise $200 million through minimum investments of $1 million to launch a fund for crypto startups – with 40% of investments supporting existing blockchain tech and 60% targeting new solutions.
Polychain Capital counts among its co-investors a solid list of Silicon Valley and New York venture capitalists. Last year it joined Twitter CEO Jack Dorsey in a Series B round for AngelList spinoff and token sale manager CoinList, raising $10 million. Polychain’s portfolio includes companies that have completed investment rounds with participation from Union Square Ventures, Andreessen Horowitz and Sequoia Capital.
Polychain, which invested in Coinbase through its first fund, opened its second fund at the start of this year but has yet to report on the amount raised to date.
Meanwhile, Hong Kong-based Amber Group today announced a $28-million investment round from leading investors to build out its platform for crypto finance. The platform allows clients to buy and sell cryptocurrency products, earn yield, manage risk and access liquidity through automated over-the-counter trading, crypto-based electronic market making and collateralized lending. Participants include Paradigm, Pantera Capital, Polychain Capital, Fenbushi Capital, Blockchain.com and Coinbase Ventures.
Earlier this week, blockchain startup BlockFi secured $30 million in funding. The crypto lending and trading platform for top digital assets such as Bitcoin, Ethereum and Litecoin, pulled in investors Morgan Creek Digital, Avon Ventures, Winklevoss Capital and Peter Thiel’s Valar Ventures, which led the round.
Also this week, Wells Fargo pumped $5 million into blockchain startup Elliptic, a Bitcoin and crypto risk management team that helps institutional clients navigate a compliant way to gain exposure to digital assets.
Crypto market maker and high-frequency trading platform Wintermute Trading just bagged seven figures in a new investment round led by Blockchain.com Ventures along with participation from FBG Capital. The London-based algorithmic trading firm, which works with crypto exchanges and trading platforms to help them create liquid, efficient markets, has partnered with Binance, Kraken, Coinbase, BitMEX, Blockchain.com, CoinList, SeedCX, TrueUSD and USD Coin, according to the company’s website.
Last week, crypto startup Transparent Systems raised $14 million in a round of funding backed by Pantera and Jack Dorsey’s Square. The Seattle-based firm is building a real-time decentralized payment settlement network. The company is targeting the outdated legacy system that powers money: the slowest technology to evolve. Additional backers include Future Perfect Ventures, IDEO Colab Ventures, CMT Digital and Digital Currency Group.
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