Reddit co-founder to raise $180M for Crypto token fund

Lavina Daryanani
Source: Forbes

Even though the crypto market is in a bear run, participants across the spectrum—including institutions—are looking to expose themselves to this asset class. In what is the latest development, the venture capital firm led by one of Reddit’s co-founders intends to raise approximately $180 million for a crypto token fund that will invest in tokens.

Citing fundraising materials, The Information reported,

“Seven Seven Six, the venture capital firm led by Reddit co-founder Alexis Ohanian, plans to raise $177.6 million for a new fund focused on investments in cryptocurrency tokens, according to fundraising materials viewed by The Information.”

Why invest in Crypto now?

Notably, the new fund will be named Kryptós and will seek to take advantage of the current market scene. Since the beginning of this year, digital assets have been shedding their value. Top coins like Bitcoin and Ethereum are down 50%-60% on their year-to-day timeframe.

Per Katelin Holloway—Seven Seven Six’s founding partner,

“This is the best time to buy if you’re really long on the industry… It’s on sale. Everything is on sale.”

Per the documents, the fund will charge investors a 2.5% management fee. Parallelly, they will also receive a carried interest of 25%. The number can go up to 35% if the investment returns five times or more capital.

The venture capital firm has been involved with crypto, blockchain, and other intersectional tech for quite some time now. Towards the end of last year, it launched a $200 million Social Media Web3 Initiative along with Polygon. Back then, Ohanian had said,

“We are still in the early days of Web3 and the most obvious opportunities right now are in gaming and social. This initiative will do just that, with a focus on gaming properties and social media platforms built on Polygon’s scalable infrastructure.”

Leaving aside Seven Seven Six, several prominent profile venture capital firms have been raising funds to invest in crypto tokens of late. In February this year, it was reported that Sequoia Capital was launching a $500-600 million crypto fund to invest in tokens traded on third-party exchanges.

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