Binance, the world’s largest cryptocurrency exchange, has defiled the odds and announced the raising of a new $500 million investment fund on Wednesday despite the bear market.
The exchange said it plans to invest in blockchain, web3, and “value-building technologies” with the new funds.
Binance Labs, the exchange’s venture capital arm, conducted the fundraising. DST Global Partners, Breyer Capital, and Whampoa Group are among the fund’s major backers. With other investment firms serving as limited partners.
The fund will invest in businesses at various stages of development, including incubation, early-stage, and late-stage companies.
Binance Labs has invested in several high-profile projects
Binance is no stranger to investing in crypto startups. The exchange’s venture capital arm has invested in several major upcoming crypto firms. These include Axie Infinity, Polygon, Elrond, The Sandbox, and STEPN.
The goal of the newly closed investment fund is to discover and support projects and founders with the potential to build and to lead Web3 across DeFi, NFTs, gaming, Metaverse, social, and more.
Binance CEO Changpeng ‘CZ’ ZhaoHowever, this has occasionally been to the company’s disadvantage. The company received over 3 million LUNA tokens for its investment in Terra and had held $1.6 billion worth of LUNA at their price peak.
The tokens are now worth a fraction of what they once were. The exchange has also been criticized for pushing the cryptocurrency UST on its platform.
Binance’s fundraising comes at a difficult time for crypto markets, with valuations falling to their lowest levels since early-2021 after a crash in May. While the markets are already recovering significantly, further price strength is still to be seen.
Still, Binance has recently expanded its business beyond crypto investments. The exchange contributed $500 million equity to Elon Musk’s Twitter takeover.
Venture capitalists raise funding amid bear market
Binance isn’t the only company that has raised funding during the market crash. Andreessen Horowitz, a crypto VC, recently created a $4.5 billion fund to profit from the current crash’s lower valuations.
Dragonfly Capital launched its largest-ever fund, valued at $650 million, in late April. This follows the raising of crypto-focused ventures by several other major firms earlier this year.
