According to reports out today, venture capitalist Andreessen Horowitz has launched a new investment project which goes by the name a16z. The name is impressive, but what does it mean for you and your crypto investments?
On a surface level, not a lot, however, we believe that a16z is a live example of how large institutional investment will pan out of the next few years. Remember, it is this investment that is sure to encourage the ‘second coming’ of cryptocurrencies. To put it plainly, projects like a16z promise a large amount of money for the markets, over a steady period. Therefore, a16z won’t manipulate the markets suddenly, instead, it will simply allow for the insertion of cash, into promising crypto projects which in turn will boost the values of the markets. According to some reports, a16z has an investment budget of $300 Million.
What is a16z?
According to Business Review, a16z partner, Chris Dixon says that it is a crypto-fund that aims to take a long-term approach to investments. Dixon says:
“We’ve been investing in crypto assets for 5+ years. We’ve never sold any of those investments, and don’t plan to any time soon. We structured the a16z crypto fund to be able to hold investments for 10+ years. We plan to invest consistently over time, regardless of market conditions. If there is another ‘crypto winter,’ we’ll keep investing aggressively.”
See the full article for yourself, here-
From Dixon’s sentiment, it is pretty clear that a16z is a well reinforced investment fund that will be used regardless of the market, in order to provide a continuous flow of money into the markets. But not reacting to market conditions, the fund will of course remain stable and won’t cause any further volatility.
So, how can it make you money?
Well, like I have said, this is the start of what could become a trend of long-term, large-scale, institutional investment. As more and more of this sort of investment surfaces, we will see market values rise and with it, so will market cap and trading volumes. a16z, should it prove to be successful, could inspire a few more investment funds of a similar size. All of a sudden then, you go from a guaranteed flow of $300 Million, up to $600 Million, inspiring a few more funds in the process, leading you up to Billions of USD in guaranteed investment.
The bottom line of this is simple. a16z probably won’t change the markets right away, but, this is an investment fund that over time will mature and bring more investment funds on board. We all know that institutional investment is the way forward, whilst a16z might not be the very start of it, it could at least go someway towards inspiring the start of it.