Despite the volatility of token prices in the past few weeks and the bleak prospect of the encryption market, venture capitalists who want to bet on the future of Web3 have not given up their steps, and the most dazzling one is a16z.
On May 25, a16z announced the launch of its latest encryption fund, crypto fund 4, with a scale of US $4.5 billion, which can be rated as a big Mac. Compared with the previous encryption fund, the size of the new fund has fully doubled, indicating that the encryption investment giant is increasingly interested in increasing the exposure of encryption startups. According to the a16 Z announcement, about $1.5 billion of the fund will be used for seed investment and $3 billion for venture capital, which makes the total amount of its cryptocurrency / Web3 funds exceed $7.6 billion.
Andreessen Horowitz (a16z) has experienced some changes in the past few years, expanding the number of employees to expand the scale of transactions.
The new fund is less than a year away from its $2.2 billion crypto fund 3, during which a16 Z has experienced as many changes as the broader encryption market.
In recent months, crypto local investment companies such as paradigm and electric capital have further risen, raising a lot of money to challenge the dominance of a16z. In addition, a16z also faced the withdrawal of Katie Haun, CO head of its cryptocurrency department, and she also took some colleagues with her to launch a $1.5 billion Haun capital.
It is reported that a16z's crypto fund 4 will continue to be steered by its partner and Web3 supporter Chris Dixon. He seems to have improved his public image in recent months, especially firmly defending Web3 on twitter. He debated with anti Web3 figures such as twitter founder and block CEO Jack Dorsey and Aaron Levie of box. In recent weeks, with the collapse of Terra ecosystem and its stabilization currency UST, many investors and entrepreneurs' continued doubts about encryption and Web3 have become stronger. The stabilization currency ust seems to have exploded overnight, evaporating tens of billions of dollars together with Luna, and calling on lawmakers to speed up the pace of legislation to control the industry.
When asked whether the cooling of the market would scare away traditional companies from continuing to bet on cryptocurrencies, Arianna Simpson of a16 Z told techcrunch that "other companies are likely to exit", but "the size of our new fund shows the extent of our excitement and belief in this investment category."
Previously, when a16z announced the launch of its last blockchain fund, the encryption market soon collapsed, but there will soon be an impressive comeback, pushing bitcoin and Ethereum cryptocurrency to record highs. Today, as technology stocks continue to suffer, the prospects for crypto investors seem less optimistic - both Robin Hood and coinbase are down more than 75% from the first day of listing - observers predict that a turbulent era is coming, not only for cryptocurrency, but also for the general technology stock industry.
Andreessen Horowitz's cryptocurrency division (a16z) is well positioned and has a lot of new capital to continue to expand its business, but the uncertainty of the future has many new founders worried about the funds available during another potential "cryptocurrency winter".
"We can't predict the future of the market," Simpson told techcrunch. "But we will work with the target companies to ensure that they have enough capital to cope with the winter storm."
A16z said it would use these funds to invest in promising Web3 startups at each stage, including Web3 games, defi, decentralized social media, self sovereign identity, tier 1 and tier 2 infrastructure, bridges, Dao and governance, NFT community, privacy, creator monetization, renewable finance, new applications of ZK certification, decentralized content and story creation, and many other areas.
Despite the recent sharp correction in the encryption market, the popularity of financing activities in this field has not decreased. On the same day, starkware, a developer of Ethereum expansion solution, announced that it had completed a financing of US $100 million with a valuation of US $8 billion. The interoperability solution layerzero will conduct a new round of financing with a valuation of $3 billion.