Andreessen Horowitz, a Silicon Valley venture capital firm established by Marc Andreessen and Ben Horowitz, announced a $4.5 billion crypto fund on Wednesday to invest in cryptocurrency projects and Web 3 firms.
While crypto downturns harm the average investor, venture capitalists take advantage of the opportunity. Andreessen Horowitz, which launched a $4.5 billion crypto fund despite the market’s pessimistic concerns, presented a similar idea.
The firm’s current $4.5 billion crypto fund is its largest to date, roughly double the size of its previous fund. The size of the investment underlines the industry’s progress, with new blockchains, DeFi platforms, and NFT-related ventures in abundance.
In an official news release, Andreessen Horowitz stated:
“We think we are now entering the golden era of web3. Programmable blockchains are sufficiently advanced, and a diverse range of apps have reached tens of millions of users. More importantly, a massive wave of world-class talent has entered web3 over the last year. That’s why we decided to go big.”
Surprisingly, the statement came amid continuous market turbulence, with most cryptocurrency prices trading considerably below their all-time highs. Following the LUNA-UST incident, Bitcoin experienced its bloodiest retracement this year, severely dampening investor sentiment this month. According to a Fortune report, crypto assets have lost almost $1 trillion in market value so far in 2022 as investors sell crypto due to macro concerns.
Firms with deep pockets, on the other hand, have continued to invest in the area, assuming that underlying growth will eventually outweigh any short-term turbulence. Andreessen Horowitz’s most recent raises occurred in June 2021 and April 2020, both following market retracements.
MicroStrategy, founded by Michael Saylor, is another well-known name that has been known to invest during crypto downturns. Despite the market’s recent downturn, CFO Andrew Kang underlined that the company will stick to its buy and HODL strategy.
However, Bitcoin remains in consolidation, hovering around the $29,500 support and $30,500 resistance levels. BTC’s outlook remained gloomy in the short-to-medium range, with daily candles still trading below moving averages (MA 50 & MA 200).
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