March 4, 2021
Cryptocurrency exchange Binance has invested an undisclosed amount in Texas-based crypto fund, Multicoin Capital. The world’s most influential crypto platform said the new investment is unique in nature and makes Binance a limited partner in the crypto-focused hedge fund.
Multicoin Capital is an Austin-based venture capital company that invests in crypto tokens and also gives investors regulated exposure to the blockchain industry. Most recently, the fund had reportedly accumulated a large position in RUNE, the native token of a decentralized cross-chain automated market maker.
The company was established in 2017, then two years later it raised its first funding that ended with a value of $75 million.
“Multicoin Capital has been instrumental in some of the biggest success stories in crypto. They work extremely hard on behalf of their investments and have developed a keen eye for identifying emerging projects and anticipating disruptive innovations that impact public markets,” said Binance CEO, Changpeng Zhao (CZ).
Multicoin Capital has made more than 20 investments in early-stage funding for start-ups in sectors including blockchain and financial technology.
One of its notable investments was in Singapore-based crypto startup, MathWallet, in which it joined Binance Labs, the incubation and seed funding arm of the world’s largest crypto exchange. Both have led the Series B funding round for MATH, the blockchain firm behind the crypto wallet, MathWallet.
With its latest investment, Binance joins firms like Ribbit Capital and Union Square Ventures, as well as individuals including PayPal’s former CEO, David Sacks in becoming Multicoin’s limited partners.
“We have invested thousands of hours researching Binance and can say unequivocally that it is one of the most strategically important infrastructure providers in the blockchain ecosystem,” said Tushar Jain, Managing Partner at Multicoin Capital.
The fund injection will be used to expand the fund’s operations including doubling down on its headcount with the addition of new business roles.
The business of crypto-focused funds has flourished as crypto firms turned to venture capitalists after ICOs activities, which were once plentiful, came under pressure globally as regulators crack down on many projects for conducting unregistered securities offerings.
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