Binance, the largest cryptocurrency exchange in the world, has announced the launch of its own venture capital fund. Binance Labs, the cryptocurrency exchange’s venture capital arm, has raised $500 million to launch a fund that would invest in Web3 and blockchain startups.
Binance Labs Raises $500 Million
Binance Labs, the company’s venture arm, announced on Wednesday that it had raised $500 million for its first start-up fund, with support from DST Global and Breyer Capital, as well as undisclosed family offices and organizations.
Binance Labs plans to invest its freshly raised funds in Web3 startups. Web3, labeled “the future of the internet,” by some, is a new version of the web.
The company’s CEO Changpeng “CZ” Zhao said:
“The goal of the newly closed investment fund is to discover and support projects and founders with the potential to build and to lead Web3 across DeFi, NFTs, gaming, Metaverse, social, and more.”
Incubation, early-stage venture, and late-stage growth are the three stages in which the fund will invest.
The enthusiasm in cryptocurrencies has spilled over into blockchain and Web3, with high-profile investment firms like Silver Lake and SoftBank putting their money into the space.
In addition, the firm plans to buy a $500 million interest in Twitter in order to back Elon Musk’s bid to buy the company, with the goal of “bringing social media and Web3 together.”
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In the wake of tumbling stocks and the collapse of stablecoin TerraUSD, Binance’s investment activities indicate a probable turning point in the crypto sector, as corporations look for the next big thing in innovation.
It follows Andreessen Horowitz’s announcement last week of a massive $4.5 billion fund to invest in crypto start-ups.
BTC/USD trades at $30k. Source: TradingView
The company’s VC arm is trying to take advantage of the recent drop in digital assets to uncover founders working on the next big thing in technology. Pre-seed, early-stage, and growth equity will be the fund’s bets, and the fund will invest in both tokens and shares.
Ken Li, Binance Labs’ executive director of investments and M&A said:
“We are looking for projects with the potential to drive the growth of the Web3 ecosystem. Such projects may include infrastructure, nonfungible tokens, and decentralized autonomous organizations. Binance estimates there are currently around 300,000 to 500,000 active Web3 developers, a number it hopes to grow “substantially.”
In the last year, the company has made a number of high-profile equity investments. This is the first time the company has formally formed a venture capital fund with outside funding.
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