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Multicoin Capital believes that the best of investment opportunities are available in the bear market. The new venture fund will focus on early-stage and later-stage projects specifically focused on aggregating Web 3 infrastructure, open finance, and decentralized autonomous organizations (DAOs).
Multicoin Capital, the crypto-native venture capital fund launched its new $430 million venture fund on Tuesday, July 12. This is the third and also the largest venture fund from the company so far.
The fund will help for capital infusion in early-stage and later-stage projects specifically focused on aggregating Web 3 infrastructure, open finance, and decentralized autonomous organizations (DAOs). The company is planning to invest anywhere between $500,000 to $25 million in early-stage projects. Similarly, it has a higher investment budget of $100 million for later-stage projects.
Interestingly, the announcement comes just at a time when the crypto market has been extremely bearish. This venture fund from Multicoin Capital will help projects who have a good future but struggling to raise funds in these depressing times.
Tushar Jain, co-founder and managing partner at Multicoin Capital, believes that some of the best opportunities arrive in a bear market. Speaking to TechCrunch, Jain added:
“Valuations are more reasonable; founders are more focused, long-term and motivated; and real users explore projects they are genuinely passionate about.”
Last year in 2021, Multicoin Capital launched a $100 million venture fund. This specifically focused on the Web 3 projects building on the Solana blockchain network. With its new venture fund, the company is also looking into other areas of investment. This will include projects fitting into Multicoin’s “proof of physical work” investment thesis. Mr. Jain said:
“While this is our largest venture fund, we deliberately raised this amount to allow us to do what we’re best at, which is investing with high conviction, in a hands-on way, at the earliest stages. Larger funds require more deals or larger check sizes. We find that we’re most impactful when we can dedicate real time and thought to projects as partners at the onset.”
Crypto Investment Firm Multicoin “Proof-of-Physical Work” Investment Thesis
Multicoin believes that projects that fall into the “proof of physical work” category “incentivize people to do verifiable work that builds real-world infrastructure”.
The firm pointed to two such projects that it currently has in its portfolio. The first is the decentralized wireless network Helium. The second is a Solana-based decentralized digital mapping network Hivemapper.
Mutcloin said that it finds projects in this sector to be very attractive with the potential to disrupt incumbent industries. Another area where Multicoin Capital is paying attention is DataDAO. These are decentralized entities based on a similar concept to “Proof of Physical Work”. However, the primary focus here is on data instead of physical infrastructure.