Quick take:
- The San Francisco-based venture capital firm plans to close the fund by the end of the first quarter next year.
- The firm has recently invested in the likes of MegaLabs, Agora, MyShell and Morph, among others.
- Dragonfly previously raised $650 million for its third fund in 2022.
The crypto-focused venture firm Dragonfly is reportedly raising $500 million in funding for its fourth fund, according to a Bloomberg report. People familiar with the matter who did not want to be named told the media publisher that the new fund has already garnered $250 million, and will invest in early-stage crypto projects.
The San Francisco-based VC has recently invested in the stablecoin project Agora, co-founded by Nick Van Eck, the son of investment management veteran Jan Van Eck.
In March, Dragonfly also led an $11 million pre-Series A round for Web3 AI platform MyShell and a $20 million seed round for consumer-focused blockchain Morph.
In June, it invested in MegaETH, a real-time EVM-compatible blockchain being developed by MegaLabs.
The report emerges at a time when multiple Web3-focused venture capital firms are returning to the market following two years of crypto winter.
According to CrunchBase’s Web3 tracker, Web3 startups raised $1.9 billion in Q1 2024, a significant increase from the $1.2 billion raised in Q4 2023, ending eight consecutive quarters of declining funding.
In Q2, the figure increased further to $2.2 billion, establishing a trajectory that is indicative of a rebound in the sector.
In February, Hack VC closed a $150 million new fund to invest in early-stage Web3 and AI projects, while Paradigm raised $850 million for its third fund which also targets early-stage crypto projects.
Last month, New York-based Robot Ventures closed its fourth fund with $75 million in funding and is also eyeing early-stage crypto opportunities.
In 2022, Dragonfly closed its Third Fund at $650 million, attracting backing from the likes of Tiger Global, KKR, Sequoia China, Ivy League endowments, and Invesco.
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