Electric Capital’s $1-billion crypto fund

Electric Capital announced its crypto-investment fund just reached $1 billion with the aim to invest in crypto-enabling platforms.

In a year, the venture firm Electric Capital – which aims to “build the future of Web3” – has raised a total of $1 billion to invest in cryptocurrency-based startups, and also to acquire cryptocurrencies. The venture firm also announced its intention to experiment with NFTs as a collateral asset to regular crypto investments.

The company, funded in 2018, aims to build an army of developers to better figure out the ins and outs of cryptocurrencies. For example, the company analyzes loads of code repositories from Github to decrypt – and maybe anticipate – the inner workings of the crypto phenomenon. In 2021, it had analyzed 500k code repositories and 160 million code commits, and published its finding in its home-cooked “Developer Report”. Electric Capital also manages an Airtable-formatted map of the crypto market.

So far, Electric Capital has invested half a mil in the crypto platform Near, made an early investment in the crypto derivatives trading application dYdx, and also invested in the crypto index manager fund Bitwise and the decentralized investing protocol Syndicate Protocol (see full list of investments here).

Investing in crypto platforms is the new hype. Just like during the gold rush, those who made money were not those who found gold (or in this case those who buy crypto-coins), but those who invested in the platforms and logistics to enable a massive gold-digging phenomenon. Electric Capital is one of those firms that understand the real biz is in platforming the crypto hype. Other funds on the market include Archetype, Horowitz’ a16z, Pantera (since 2013), Grayscale (also since 2013), Paradigm, Sarson, … For those who want to make a buck out of the crypto phenomenon, the right move is to pour money into those investment firms instead of buying volatile bits of uncertain currencies.