Ex-Coinbase Pros Raised A $500M Fund To Buy Shares In Animoca Brands, Chainalysis
Blockchain companies, including Animoca Brands and Chainalysis, are now in the crosshairs of a $500 million fund aimed at acquiring secondary shares in crypto firms at significant discounts. This fund, C1, established by ex-Coinbase COIN legal and investment professionals, is reportedly seeking to purchase stakes in various crypto ventures at 50% to 80% below their last assessed values.
The crypto sector is witnessing renewed interest from investors, evidenced by the surge in Bitcoin, crossing the $40,000 mark for the first time in two years. This bullish trend is also reflected in other altcoins, including Ethereum, Shiba Inu, Dogecoin and other alt-coins
C1 Fund’s strategy, according to the Australian Financial Review, involves targeting crypto companies valued at a minimum of $300 million in their most recent funding round, focusing on Series C or later stages.
The fund aims to invest between $20 million and $50 million per deal.
Animoca, which transitioned from a $120 million company to a $7.8 billion private entity after delisting in 2020 on the ASX, is a potential target for C1.
The company’s last fundraising round priced shares at approximately $4.50, but C1 Fund has proposed buying them at around $1.12.
Chainalysis, valued at S8.4 billion in 2022, has been approached by C1 Fund for purchasing secondary preferred shares at a 63% discount.
However, Immutable, a prominent crypto gaming developer valued at $2.5 billion, doesn’t appear to be on C1’s list.
While C1 Fund positions itself as a liquidity provider for venture capitalists, local investors seem reluctant to sell their stakes, especially those that have weathered the prolonged crypto downturn.
Local crypto exchanges like Independent Reserve and BTC Markets have seen a customer influx, particularly after Binance’s founder faced money laundering charges.
These regulated local platforms reported up to a 50% increase in trading volumes.
Despite a period of stagnation in crypto prices and high-profile fraud cases, the market is showing signs of recovery due to anticipation of a U.S.-regulated Bitcoin ETF and a technical upgrade to the Bitcoin network scheduled for May, which is expected to cap the token supply and potentially drive prices up. Investors are optimistic that the ETF approval could attract major Wall Street firms, bringing a new wave of investors into the crypto space.