Two years in the past, the enterprise agency Andreessen Horowitz (a16z) took the wraps off a devoted crypto fund from a subset of its restricted companions who supplied the agency with $300 million in capital commitments. Now, the agency says it has closed a second fund in the identical vein, this time with $515 million in capital commitments.
As normal associate Chris Dixon — who leads the fund with normal associate Katie Haun — tells Fortune: “It’s very uncommon that main, new computing paradigms come alongside, and we expect that is on the size of cloud and cellular for the Web.”
Actually, the agency has much less competitors for crypto offers in the intervening time than it might need again in 2018. Many VCs pulled again final 12 months, with general funding in 2019 down 28% from 2018’s peak of $4.3 billion, in line with CB Insights.
Bitcoin and the cryptocurrency markets have been additionally hammered together with the broader inventory market in a downturn sparked by the COVID-19 disaster, inflicting some to conclude they’re as susceptible to loads of different devices to inventory market shifts.
An enormous upswing since — together with this apparent endorsement by a16z — may flip these developments round, nonetheless. Certainly, the complete market capitalization of cryptocurrencies jumped $35.3 billion in 24 hours as of two:19 p.m. Singapore time, in line with information from CoinMarketCap.com and reported by CNBC.
Bitcoin, particularly, which fell beneath $4,000 final month, shot as much as $9,388.30 by earlier in the present day (although, as that is being written, it has slipped to $8,695.41).
Business members attribute the rally to central financial institution financial coverage and the “bitcoin halving” that’s anticipated subsequent month, when for the third time within the community’s historical past, the reward for mining a block might be divided by two.
Andreessen Horowitz has invested immediately in cryptocurrencies like Bitcoin and Ethereum, together with a variety of different bets that embody Coinbase, the crypto lender Compound and Anchorage, a cryptocurrency custody service.
It’s additionally a member of each the Libra Affiliation and the Celo Alliance for Prosperity, each of that are inviting builders to construct decentralized cellular apps which might be primarily based on their very own cryptocurrencies.
To drum up much more deal stream, a16z final month kicked off a free, seven-week program for cryptocurrency startups that goals to teach and “complement — not exchange — the various different glorious applications and assets that assist founders find out about constructing tech startups,” Dixon wrote of the varsity late last year.
The agency isn’t taking fairness within the startups as a part of this system, it says. As an alternative, it’s apparently seeking to construct connections to and between founders who it would wish to work with it sooner or later.
Along with Dixon and Haun, the agency this 12 months added a 3rd deal associate to its cryptocurrency apply: Arianna Simpson, the founder and managing director of the cryptocurrency-focused hedge fund Autonomous Companions.