Maelstrom’s Akshat Vaidya criticized oversized early-stage crypto funds for delivering poor returns and charging high fees.
Akshat Vaidya, co-founder and managing partner at Maelstrom, the family office of BitMEX founder Arthur Hayes, has taken aim at early-stage crypto funds like Pantera Capital. He accused these funds of becoming “too big” and ultimately failing their investors.
In a recent post on X, Vaidya revealed that his $100,000 investment in the Pantera Early-Stage Token Fund LP from four years ago had declined to just $56,000 due to its high-cost structure.
Crypto VC Funds: How LPs Get Rekt
My $100K, vaporized into $56K within 4 years (3% mgmt + 30% carry) by this Early-Stage Token Fund
During those 4 years, BTC 2x’d and numerous seed deals did 20-75x. Yet this fund charged fees to erase half of LP capital. [Vintage matters, sure,… https://t.co/NgLBhxa9AS pic.twitter.com/2R4KJrJyR8
— Akshat_Maelstrom (@akshat_hk) November 3, 2025
Notably, the fund included a 3% management fee and a 30% performance fee, significantly eating into profits. Vaidya compared its lackluster performance to the broader crypto market, which had seen strong growth over the same period.
For instance, Bitcoin BTC $89 369 24h volatility: 0.2% Market cap: $1.78 T Vol. 24h: $21.94 B more than doubled in value within a taken period, while many early-stage projects achieved returns as high as 20x to 75x.
Maelstrom co-founder argued that funds managing large pools of capital often struggle to find high-quality projects. They end up spreading investments too thinly, diluting potential gains.
According to Vaidya, most early-stage crypto funds have expanded beyond what the current market can sustain, leaving limited partners (LPs) with disappointing results.
He added that investors deserve better opportunities to scale their exposure rather than locking up capital in oversized funds chasing too few winners.
The Growing Debate Over Crypto Fund Efficiency
Vaidya’s comments come amid a larger question of whether early crypto funds, once important in blockchain innovation, have simply outgrown the industry.
Leading firms like Pantera Capital, Andreessen Horowitz’s a16z Crypto, and Paradigm have each raised multi-billion-dollar funds. However, deploying that much capital efficiently in a relatively young market has proven difficult.
This has led to what critics call a “spray and pray” investment model, where funds place small bets on numerous startups rather than pursuing targeted opportunities.
On the other hand, smaller firms are positioning themselves as more disciplined and value-focused. For example, Maelstrom prioritizes cash-flowing, acquisition-ready crypto businesses, offering founders straightforward exits without long token unlock periods.
In October, a Bloomberg report claimed that the company is raising over $250 million for a new private equity fund to acquire mid-sized crypto infrastructure and data firms.
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