Crypto Firms and Venture Capitalists Ramp Up Fundraising as Market Sentiment Rises

As cryptocurrency prices recover, both crypto companies and venture capital (VC) firms are raising significant amounts of capital, reflecting improved market sentiment.

Digital asset management company ParaFi Capital has raised $120 million from a group of investors that includes Theta Capital Management and Accolade Partners, highlighting robust growth in the crypto fund space.

This capital infusion follows Lemniscap, a VC firm focused on cryptocurrency, which recently secured $70 million to invest in blockchain startups.

The rise in crypto fundraising is gaining momentum as optimism returns to the market. According to Bloomberg, part of ParaFi’s raised funds will be allocated to acquiring general-partner (GP) stakes in other crypto-focused funds. Over the next three to five years, the company aims to assemble a portfolio of up to 50 of these stakes.

Founded in 2018, ParaFi Capital has actively invested in various digital asset companies. Earlier this month, ParaFi led a $10 million Series A round for Parfin, a digital asset infrastructure provider.

Ben Forman, founder of ParaFi Capital, explained the firm’s strategy: “We’ve closely observed the evolution of the crypto-fund ecosystem over the years. As more institutional capital flows into the sector, we anticipate the emergence of numerous specialized crypto funds, focusing on specific geographies, themes, or types of investment.”

Several other crypto firms and VC entities are also seeking capital or have recently completed funding rounds. Lemniscap’s $70 million will be invested across multiple areas, including zero-knowledge infrastructure, consumer applications, emerging Bitcoin ecosystems, decentralized physical infrastructure (DePIN), and blockchain security.

Accolade Partners, a fund that supports early-stage blockchain ventures, is also backing the Lemniscap initiative.

Among other notable fundraises, wireless internet service provider Andrena raised $18 million to develop DAWN, a decentralized autonomous wireless network, with Dragonfly and other key investors contributing to the round.

Blockscout, an open-source block explorer, secured $3 million in seed funding led by 1kx, which will help the startup expand its offerings and improve its explorer-as-a-service (EaaS) platform.

Additionally, blockchain game developer Cartridge raised $7.5 million in a Series A round led by BITKRAFT Ventures, aimed at further developing Dojo 1.0, an open-source toolset for blockchain-based game development.