Paradigm has unveiled its latest crypto fund worth $2.5 billion, which has overtaken Andreesen Horowitz’s crypto fund from earlier this year.
Next Big Thing In Crypto VC Investments
In an official announcement released on their website, team Paradigm revealed that co-founders Fred Ahrsam and Matt Huang have successfully raised $2.5 billion for their “New Venture Fund” to explore investments in crypto companies and protocols. The capital raised for this fund has broken the record of Andreessen Horowitz’s (a16z) $2.2 billion raise in June 2021.
The VC company has also accumulated one of the largest token holdings in the world. According to co-founder Ehrsam,
"The biggest companies in the world are large internet tech companies powered by network effects. We think decades into the future it's very clear the largest entities in the world will be powered by tokens."
$2.5B Is Small Amount: Co-Founder
Paradigm One was launched in 2018 by Ehrsam and Huang, with initial fundraising of $400 million. Thanks to the craze around crypto investments, they were able to more than double their initial investment goal by raking in the latest $2.5 billion. However, Ehrsam believes that the amount is probably small compared to the 10-year potential of the fund.
In their announcement, the founders discuss the possibilities of the crypto industry, citing how decentralized finance (DeFi) is altering the face of the global financial system and ushering in Web 3.0. The statement revealed that it was crucial for the team to be a part of this crypto revolution by creating this investment firm that would be entirely crypto aligned and could provide the best support to budding crypto entrepreneurs and communities. The founders also discussed the value of protocol research in Web 3.0 culture by establishing expert teams of research, engineering, security, talent, communications and marketing, legal and policy, and more.
Investment Goals Of VC Fund
The team also talked about the goal of the new venture fund. Despite garnering global attention, less than 10% of the world’s population currently holds cryptocurrency. The announcement addressed this factoid, claiming that DeFi systems still have a long way to grow to be comparable to the traditional financial market. Therefore, the Paradigm One team is hoping to be one of the early players in the crypto investment stage in order to continue supporting the industry.
They also clarified that the new fund would invest alongside the company’s existing flagship fund across all stages and geographies. Other than investing at the early stages of exciting ideas, the fund will also be used to partner with later-stage category leaders and provide support to companies in need of funding.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.