Galaxy Digital Holdings is launching a $100 million fund aimed at supporting early-stage cryptocurrency startups, the firm said in a an email sent to the company’s investors.
The Galaxy Ventures Fund I LP is set to allocate over $1 million to each of up to 30 startups in a span of three years. The fund will primarily target startups involved in ‘financial applications, software infrastructure, and protocol development within the cryptocurrency sector.’
Galaxy’s decision to establish a new fund for early-stage digital asset companies coincides with a significant uptick in funding rounds within the cryptocurrency industry. According to public data, crypto startups raised approximately $3.1 billion in the fourth quarter of 2023, showing a significant increase from $1.7 billion in the previous quarter.
Cryptocurrency and blockchain startups received a funding injection of $10.7 billion from venture capitalists in 2023, a significant 68% decrease compared to the $33.3 billion invested in 2022.
REPORT | Global Funding for Crypto and Blockchain Startups Fell 68% in 2023
The number of crypto venture capital deals also experienced a deceleration in 2023, with a total of 1,819 deals, marking a 32% decrease from the 2,671 deals recorded in 2022.https://t.co/MINBteGOmL pic.twitter.com/MSMs0Pzbx7
— BitKE (@BitcoinKE) January 15, 2024
According to Galaxy, over the past six years, it has invested $200 million in more than 100 projects. Although Galaxy’s Interactive team has previously secured external capital, this latest move marks the first time the venture team is going all out with its own fund.
“We’re excited to build on our successful track record of investing in digital asset ventures and blockchain infrastructure. For years, we’ve been putting our own capital behind these innovators,” said Mike Wursthorn, Galaxy’s Head of Communications.
“Now we’re launching Galaxy Ventures Fund I LP to partner with outside investors, allowing us to continue fueling the digital asset ecosystem by backing promising early-stage ventures.”
Galaxy Digital’s ambitious fund launch underscores a resurgence of interest within the venture capital sector. Earlier this year [2024], Marc Andreessen, Accolade Partners, and Galaxy Digital teamed up to establish a $75 million fund in partnership with the 1kx network.
Additionally, reports suggest that Paradigm is in the process of raising between $750 million and $850 million, while Hack VC is aiming to secure a minimum of $100 million in funding.
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