Key Takeaways
Bain Capital Ventures is launching a $560 million fund focused on the digital assets space.
Bain has previously backed some crypto-native firms and projects, but this is its first fund dedicated to the asset class.
It plans to participate in governance for projects and provide liquidity.
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Bain Capital Ventures has long been involved in the crypto space, but this is its first fund dedicated solely to the asset class.
Bain Capital Ventures Launches $560M Fund
As funding continues to pour into the crypto space, Bain Capital Ventures is doubling down.
The investment giant is launching a $560 million fund called BCV Fund I that will focus solely on the asset class. It closed in November with $100 million invested into 12 as yet undisclosed projects, Bain Capital Crypto managing partner Stefan Cohen told Bloomberg in an interview announcing the launch.
Bain Capital Ventures has been active in the space for several years, with investments in the likes of BlockFi, Digital Currency Group, and the Ethereum-native DeFi staple Compound. However, until now, it’s never run a fund that exclusively invests in the digital assets space.
“We’ve become quite high conviction we are at the beginning of a multi-decade technology shift,” Cohen told Bloomberg, echoing sentiments shared by various Web3-curious Silicon Valley titans over the last few months. This conviction, Cohen said, is what spurred the firm to launch Bain Capital Crypto.
Bain plans to use the fund to back a range of projects involved in blockchain technology, including startups, DAOs, alternative Layer 1 networks, and infrastructure. The full $560 million will likely be allocated over the next two to three years across roughly 30 companies. Similar to Sequoia Capital, which last month made a quantum leap in its crypto-related endeavors with a $600 million fund launch, Bain says it plans to be an active investor, participating in governance and providing liquidity.
Bain’s fund launch comes during a rocky period in the crypto market. The global cryptocurrency market cap is 40% short of its November 2021 peak, with uncertainty over the Federal Reserve’s planned rate hikes, an upcoming Executive Order from President Biden, and the Russia-Ukraine conflict bringing sentiment to lows not seen since the market-wide May 2021 crash.
Still, recent macroeconomic turmoil has done little to stop the flood of capital pouring into the space from venture funds. After the likes of Andreessen Horowitz and Sequoia, Bain is only the latest venture firm to join the bandwagon with a mega-sized bet.
Disclosure: At the time of writing, the author of this piece owned ETH and several other cryptocurrencies.
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