Sequoia Capital has reportedly decided to relocate funds, that it had originally kept for crypto-related projects, elsewhere. The tech-centric venture capital firm is supposedly reducing its crypto fund by a whopping 65 percent. The decision could be fuelled by the slump that the overall crypto market is undergoing presently. The sector, which was valued at over $3 trillion (roughly Rs. 2,46,91,380 crore) around November 2021, currently stands at the capitalisation of $1.18 trillion (roughly Rs. 97,04,768 crore).
The US-headquartered venture crypto fund was valued at $585 million (roughly Rs. 4,813 crore) at the time of its launch in February this year. Its decision to cut down on this funding leaves the capital pool with just $200 million (roughly Rs. 1,645 crore), The Wall Street Journal said in its report.
The company has not officially announced the reduction in its crypto-centric fund yet.
The ongoing slump in the crypto market, however, is being touted among top reasons why Sequoia has decided to reevaluate its engagement with the volatile digital assets sector.
As on Friday, the most expensive cryptocurrency, Bitcoin, is trading at $29,205 (roughly Rs. 24 lakh). Its last attained all-time high was $68,000 (roughly Rs. 56 lakh) which it touched in November 2021.
Between 2022 and 2023, promising crypto projects like the FTX exchange as well as the Terra project failed due to mismanagement of funds and liquidity crunch, draining billions out of the crypto market.
In addition, back-to-back interest rate hikes in the US, the trend of de-dollarisation that picked pace in other nations, and other market upheavals also cost the digital assets market billions of dollars as well as the trust of its community.
A recent survey by JP Morgan said that 72 percent of institutional e-traders are now sceptical about experimenting with cryptocurrencies in 2023. The volatility of the crypto market emerged as the biggest reason that has scared hefty investors.
A total of 353 funding rounds reportedly fetched $2.6 billion (roughly Rs. 21,380 crore) towards start-ups working in the crypto sector in the first quarter of 2023, between January and March. Interestingly, the figures of both the investment rounds and the capital raised have shown a decline of 78 percent and 64.4 percent, respectively, from last year’s first quarter.
Under the market situation, Sequoia is looking to take better financial decisions to avoid hefty losses.
Instead of investing in already established Web3 firms, Sequoia could be redirecting its focus on helping new projects take off with its remaining crypto fund.
“We made these changes to sharpen our focus on seed-stage opportunities and to provide liquidity to our limited partners,” the VC firm reportedly told the Financial Times.
Samsung launched the Galaxy Z Fold 5 and Galaxy Z Flip 5 alongside the Galaxy Tab S9 series and Galaxy Watch 6 series at its first Galaxy Unpacked event in South Korea. We discuss the company’s new devices and more on the latest episode of Orbital, the Gadgets 360 podcast. Orbital is available on Spotify, Gaana, JioSaavn, Google Podcasts, Apple Podcasts, Amazon Music and wherever you get your podcasts.
Affiliate links may be automatically generated – see our ethics statement for details.
For all the latest Technology News Click Here
For the latest news and updates, follow us on Google News.
Denial of responsibility! NewsBit.us is an automatic aggregator around the global media. All the content are available free on Internet. We have just arranged it in one platform for educational purpose only. In each content, the hyperlink to the primary source is specified. All trademarks belong to their rightful owners, all materials to their authors. If you are the owner of the content and do not want us to publish your materials on our website, please contact us by email – [email protected]. The content will be deleted within 24 hours.
