Polychain Capital and Coinfund, two crypto venture capital firms, raised $350 million for their new investment funds.
According to sources acquainted with the situation, Polychain raised $200 million during the “first close” of its fourth investment fund, according to a July 18 Forbes article. After the closure, Polychain will have contracts with investors and be able to start funding initiatives and entrepreneurs.
Despite the large boost, Polychain still hopes to gather $400 million for the new fund. Due to its changing spending priorities, Polychain also let go of three members of its research team.
According to Pitchbook data, Polychain is now in charge of three funds with a combined $2.6 billion in assets under management. According to a July 18 Bloomberg report, VC firm Coinfund also raised $152 million for its fourth seed fund, despite VC financing for cryptocurrency companies steadily falling for over a year.
The company had set a goal of obtaining $125 million, according to Coinfund CEO Jake Brukhman, but was able to raise an additional $27 million thanks to renewed interest in the sector.
According to data from business analytics firm Crunchbase, the overall amount of venture capital for crypto and Web3 firms decreased by 76% from last year.
Following the failure of Do Kwon’s Terra Money ecosystem, Sam Bankman-Fried’s FTX, and several other well-known initiatives over the last two years, investors are allegedly becoming more cautious about the cryptocurrency industry.
This has led to a shift away from less innovative business segments, and many venture capitalists are now wary of all new investments, with artificial intelligence being the one prominent exception.
Over $12 billion in venture money has been invested in the AI industry as of January 1 as investors aim to profit from the emerging market.