Circle Launches Venture Fund – Blockworks

Circle is the latest company to launch a venture fund to invest in early-stage blockchain projects and companies. 

The Boston-based peer-to-peer payments technology company is the principal operator of USD Coin (USDC) as well as fundraising platform SeedInvest. The portfolio companies of the new fund, called Circle Ventures, will have access to SeedInvest’s network of over 500,000 investors.

“Circle’s mission is to raise global economic prosperity through the frictionless exchange of financial value,” Circle CFO Jeremy Fox-Green wrote in a Tuesday blog post. “Achieving it is ambitious and will take a village of many, many people and projects and companies to develop the technologies, the products and protocols needed to get us there.”

A spokesperson for the company told Blockworks that Circle does not yet know how much money it will ultimately invest in such companies that accelerate its mission.   

Circle Ventures has already deployed initial capital and is looking to the community of entrepreneurs, developers and innovators in the blockchain ecosystem to help identify opportunities for future deployments.

Among the first investments was in JPY Coin (JPYC), which is growing its prepaid stablecoin denominated in Japanese Yen, a Circle representative noted. The capital was deployed in JPYC alongside Headline Asia.

Circle is focused on leveling the playing field for entrepreneurs and individual investors, Fox-Green added in the blog post.

“In this rapidly changing world, we are all growing and learning and evolving, and we have no way of knowing what will happen over time,” he wrote. “Perhaps one day some of these projects will be Circle customers, but that is not our goal today. We want to accelerate our mission, and believe that the substantial benefits of doing so will accrue to us all over time.”

Circle Ventures is the latest example of investment in young blockchain projects and companies as capital into the space has accelerated. 

A year of crypto-related investments

An all-time high of $17 billion had been invested into crypto projects in 2021, as of mid-June. Venture capitalists had put a record $21.4 billion toward cryptocurrency and blockchain-related companies as of Sept. 30, according to market data provider Pitchbook, the New York Times recently reported.

Venture capital firm Andreessen Horowitz, also known as a16z, announced a $2.2 billion crypto fund in June. In September, private equity firm 10T Holdings announced that it had raised $750 million for its first two growth equity funds focused on digital asset companies, and Pantera Capital revealed a blockchain fund that is targeting $600 million.

Most recently, Cadenza Ventures raised $50 million for its crypto fund that will invest in crypto platforms and blockchain technologies internationally.

Andreessen Horowitz said in a blog post on Monday that it led a Series B investment in Matter Labs, the architect of zkSync, a solution that uses zero-knowledge proofs to scale Ethereum in a way that preserves its values of decentralization and security.

Pantera Capital’s blockchain fund has invested in nine early-stage token projects and two venture equity deals, and has a record pipeline, Pantera CEO Dan Morehead said in his latest blockchain letter published on Tuesday. In addition to investments into the gaming and NFT sectors, Morehead noted investments into layer-2 scaling solution Arbitrum and crypto platform BitOasis.