Silicon Valley-based venture capital firm Andreessen Horowitz, has raised capital for its fourth cryptocurrency fund amounting to $4.5B, bringing its total crypto/web3 fundraisings to more than $7.6B, according to a release Wednesday.
Approximately $1.5B of the new funds will focus on seed investments and $3B will be dedicated to venture investments, a16z said.
Andreessen Horowitz, who has been investing in the decentralized space since 2013, said it will use the fund proceeds to invest in “promising web3 startups at every stage.” Specifically, a16z is paying attention to the developments in web3 games, decentralized finance (“DeFi”), decentralized social media and layer 1 and layer 2 infrastructure.
“We think we are now entering the golden era of web3,” a16z highlighted. Programmable blockchains are sufficiently advanced, and a diverse range of apps have reached tens of millions of users. More importantly, a massive wave of world-class talent has entered web3 over the last year.”
Nevertheless, the crypto market, in particular, has been deteriorating since the end of 2021, with bitcoin (BTC-USD) down over 23% Y/Y and ethereum (ETH-USD) -28% Y/Y. Cryptos’ profound drawdowns come as investor uncertainty gets dragged down across a wide range of asset classes amid rising interest rates and tighter financial conditions.
The global crypto market cap is off more than 50% from its peak of $3T in November 2021, according to data from CoinMarketCap.
Still, “bear markets are often when the best opportunities come about, when people are actually able to focus on building technology rather than getting distracted by short-term price activity,” Arianna Simpson, a general partner at a16z told CNBC in a phone interview.
a16z’s move followed its funding talks with Yuga Labs, the start-up behind Bored Ape Yacht Club, one of the most popular non-fungible token collections.
In June, a16z raised $2.2B for a crypto venture fund.