Read

VC firm Sequoia Capital has reportedly downsized its crypto fund from $585 million to $200 million amid a liquidity crunch and focus on smaller crypto players. 
A <a href="https://www.wsj.com/amp/articles/sequoia-capital-slashes-crypto-fund-as-it-downsizes-amid-startup-crunch-f396bb0b" target="_blank" rel="noopener noreferrer nofollow">report </a>by the Wall Street Journal on July 27 says the tech-focused VC firm Sequoia Capital will scale back its crypto fund. The move was driven by the need to align with the evolving market conditions in the cryptocurrency industry. 
One of the primary motivations behind the fund reduction is to lower the capital threshold, making it easier for investors to participate in Sequoia’s fund offerings. 
“We made these changes to sharpen our focus on seed-stage opportunities and to provide liquidity to our limited partners,” stated Sequoia in a released statement. Over the past three years, the company has returned more than $15 billion to its investors, highlighting its commitment to delivering results. 
 You might also like: <a href="https://crypto.news/vc-crypto-funding-plunged-91-since-2022/" rel="noopener noreferrer nofollow"> VC crypto funding plunged 91% since 2022 </a> 
The venture capital firm introduced its cryptocurrency fund in February 2022, when the market capitalization of cryptocurrencies was 39.1% lower than its peak at $3 trillion in November 2021. 
Unfortunately, Sequoia faced setbacks with its <a href="https://crypto.news/sequoia-capital-shakes-up-crypto-team-after-214-million-ftx-loss/" rel="noopener noreferrer nofollow">$214 million investment</a> in FTX, the cryptocurrency exchange that collapsed in December last year. This led to a high-profile incident that necessitated a rare <a href="https://crypto.news/sequoia-capital-apologizes-to-investors-after-ftx-loss/" rel="noopener noreferrer nofollow">apology </a>from the firm to its investors. 
<h2 class="wp-block-heading" id="crypto-vc-investment-experiences-70-drop-in-one-year">Crypto VC investment experiences 70% drop in one year</h2> 
Sequoia’s reported decision mirrors a wider trend in the venture capital industry, where firms are cutting back on their cryptocurrency investments. 
<a href="https://www.rootdata.com/dashboard" target="_blank" rel="noopener noreferrer nofollow">Data </a>released by RootData reveals a significant decline of over 70% in venture capital investments in cryptocurrency companies over the past year. 
<figure class="wp-block-image size-full"> 
 <img decoding="async" width="1136" height="539" src="https://crypto.news/app/uploads/2023/07/Screenshot-45.png" alt="Sequoia Capital cuts its crypto fund by 65% - 1" class="wp-image-14181568"> 
 <figcaption class="wp-element-caption">
 Crypto fundraising trends | Source: <a href="https://www.rootdata.com/dashboard" target="_blank" rel="noopener noreferrer nofollow">RootData</a> 
 </figcaption> 
</figure> 
In June 2022, the digital asset sector attracted an impressive $1.81 billion in funding through 149 funding rounds. However, in June of the current year, only 88 projects managed to secure a total of $507 million, making it the least funded month to date. 
Despite the overall trend of reduced cryptocurrency holdings among venture capital firms, some companies like Polychain Capital and Coinfund have recently raised <a href="https://crypto.news/polychain-secures-200m-for-fourth-crypto-vc-fund-amid-staff-departure/" rel="noopener noreferrer nofollow">$200 million</a> and $152 million for their investment and seed funds, showing that not all are shying away from the crypto space. 
 Read more: <a href="https://crypto.news/vcs-poured-investments-into-defi-despite-us-crackdown/" rel="noopener noreferrer nofollow"> VCs poured investments into DeFi despite US crackdown </a>

Sequoia Capital cuts its crypto fund by 65%

Table of Contents

crypto.news

Other articles published on Jul 28, 2023

Bitcoin détrônera les fiats, dixit Tim Draper

WSJ: Sequoia Capital Reduces Its Crypto Fund

Bloktopia Introduces $BLOKN, a Reward Token Solely Redeemable against NFT Purchases

Amazon's Foray into NFTs: A Significant Leap for the Blockchain Ecosystem

Tesla Kebut Komputer Super, Untuk Apa?

Milyarder AS Kritik Keras SEC dalam Kasus Ripple Labs

Join our free newsletter for daily crypto updates!