China-headquartered cryptocurrency exchange Crypto.com has expanded its corporate venturing unit’s fund to $500m, TechCrunch reported today, becoming the latest crypto exchange to beef up its investment subsidiary.
Crypto.com Capital invests in early-stage crypto technology developers, generally leading seed rounds with investments of up to $1m and up to $10m for series A rounds. The expansion more than doubles the size of its fund, which was initially launched in March 2021 with $200m.
The unit’s focus areas include blockchain gaming, metaverse, non-fungible tokens (NFTs) and decentralised finance (DeFi). It has also hired Jon Russell, most recently Southeast Asia editor for India-based business and tech publication The Ken and a former TechCrunch writer, as a partner.
Russell said: “I have had offers to move into crypto full-time before but Crypto.com is the most ambitious company in web3.
“The Crypto.com Capital fund brings a very unique advantage to help the world’s best web3 founders and startups to realise their potential and I cannot wait to play my part.”
Crypto.com Capital’s portfolio includes Efinity, a blockchain technology developer for NFTs, as well as e-wallet provider Krystal, play-to-earn gaming guild YGG SEA, DeFi lending platform Naos Finance, trading platform developer Woo Network and NFT platform creator Mintable.
Last month, the unit took part in a $25m funding round for DeBank, the creator of a decentralised finance portfolio tracker, alongside investors including digital currency wallet provider Ledger, which is also a Crypto.com Capital portfolio company.
In contrast with many similar funds (a notable exception being cryptocurrency trading firm FTX Trading’s recently established FTX Ventures), Crypto.com Capital does not have external limited partners and funds every deal of its parent company’s balance sheet.
FTX Ventures, headed up by Lightspeed Venture Partners alumn Amy Wu, just launched with $2bn in capital, incorporating the $100m gaming fund FTX launched together with blockchain technology developer Solana and Lightspeed Venture Partners in November 2021.
Fellow crypto exchange Binance launched an investment scheme of its own in October 2021, launching a $1bn fund through its Smart Chain subsidiary to invest in Defi and blockchain companies.
Binance Smart Chain then teamed up with digital entertainment and blockchain technology developer Animoca Brands in December for a $200m scheme to support gaming finance and play-to-earn projects.
Venture capital firms have also been leaning heavily into purpose-built crypto vehicles. Andreessen Horowitz launched a $2.2bn third crypto fund in June 2021 that follows its $300m inaugural crypto vehicle in 2018 and a $515m second fund that closed in early 2020. Paradigm formed a $2.5bn crypto fund five months later.
Crypto.com’s chief executive, Bobby Bao, said: “Crypto.com Capital is not even one year old, but already we work hand-in-hand with dozens of world-class founders and we want to find more. Adding Jon to the team is a statement of intent to double down and grow the web3 ecosystem.”
