Andreessen Horowitz launched a $2.2 billion crypto fund

June 25, 2021: -Andreessen Horowitz launched a multibillion-dollar fund to invest in a volatile ecosystem it’s betting will be influential like the internet.

The Silicon Valley venture capital firm was founded by Marc Andreessen and Ben Horowitz, announcing its new $2.2 billion cryptocurrency-focused funds. It plans to deploy that capital in blockchain and digital asset start-ups.

“The size of this fund speaks to the size of the opportunity before us, crypto is not the only future of finance but, as with the internet in the recent days, is poised to transform all aspects of our lives,” Katie Haun and Chris Dixon, the partners running cryptocurrency group of Andreessen, said in a blog post.

The first crypto-focused fund of the company was launched three years ago, is known as “crypto winter.” That year, the value of bitcoin cratered around 80% from the highs in the year 2017. So the latest fund also comes at another bearish moment for bitcoin.

The original cryptocurrency of the world has lost nearly half its value since the high, around $60,000 in April. This week alone, it’s on track for a loss of 20%. Haun and Dixon noted the asset class’s volatility and said, “prices may fluctuate, but the innovation keeps on increasing through each cycle.”

“We believe that the next wave of computing innovation will be driven by crypto,” the partners wrote, adding that they’re “radically optimistic about crypto’s potential.”

The firm is known for early bets on companies like Facebook, Instagram, Lyft, and Pinterest. Andreessen Horowitz made its first move into the digital asset space through Coinbase in the year 2013. Coinbase went public through a direct listing this year and is decreased 50% from its listing day high.

Andreessen Horowitz is an early investor in Facebook-backed digital currency project libra, called Diem, which has gone through a series of rebranding and faced opposition from global regulators.

The firm has stakes in OpeanSea and Dapper Labs companies, powering the recent NFT boom, and said it plans to focus on “decentralized finance.” Also known as “define,” the term used to describe traditional finance applications, such as lending or banking, built on the same technology that underlies bitcoin. The firm said it is planning to hold these crypto investments for a decade or more.

These digital asset investments are driven by Haun, a former Justice Department prosecutor, and Dixon, who founded and ran two start-ups before it joined Andreessen Horowitz. Haun helped launch Justice’s first government task force for crypto of the department and worked on the first high-profile cryptocurrency-related case, Silk Road.

Andreessen Horowitz announced a wave of new hires for the fund that included former Securities and Exchange Director Bill Hinman and will be joining the firm as an advisory partner. In addition, Rachael Horwitz, who led communications at Twitter, Google, and Facebook, joined as an operating partner.