On a new Twitter mail Dated Dec. 12, Du Jun, co-founder of cryptocurrency exchange Huobi Global, shared a new perspective on his experience managing ABCDE Capital, a $400 million Web 3.0 venture capital (VC) fund, in June this year. According to Jun, the idea for ABCDE Capital came up in March, and by April, it was already registered in Singapore. However, amid the $40bn Terra Luna implosion in May, Jun said “the old money is almost gone” after the incident.
we choose to start @ABCDECapital in the most difficult moment of the market. I hope to bring a ray of light to builders and bring more fairness, innovation and strength to the cryptocurrency industry. https://t.co/GmxFFsG7qL
—Du Jun (@DujunX) June 17, 2022
Undeterred, Jun went on to say that by August, the venture capital fund was fully operational, with “some partners raising tens of millions of dollars to invest.” While an initial report in early November revealed “very good” results, Jun said FTX’s subsequent collapse was “far beyond expectations” for the industry:
“Layoffs, salary cuts and shrinkage became major issues for cryptocurrency companies. One thought that the dispute between FTX and Binance would foster a healthy development of the industry, but it turned out that FTX was so weak that it simply gave up, which triggered a wave of catastrophe.Today Binance has over 75% market share, and like it or not, CZ’s [Binance CEO Changpeng Zhao] The attitude towards regulation represents that of the entire industry, and it is a great challenge for CZ.”
Regarding decentralized finance, or DeFi, Jun attributed last summer’s boom to the US Federal Reserve’s quantitative easing (QE) measures. Linking it to regulation, Jun said DeFi’s growth occurred in largely because companies like Coinbase, Circle, Grayscale, and Paxos “actively embraced regulation” and allowed large institutional investors into the space in the context of QE.
“The FTX implosion made traditional old money and government agencies afraid, or even disgusted, of the chaotic and messy environment of cryptocurrencies. For a long time afterward, governments would not support lax policies that support development and innovation. in cryptocurrencies, nor are sovereign wealth funds investing in the market.”
Jun also revealed that since ABCDE Capital began investing in August, the firm has amassed seven companies in its portfolio across the security, data, social, zero-knowledge, and non-fungible token sectors. “ABCDE only invests in 15-20 companies per year, a good company is not afraid of a bear market, referrals are welcome, let’s keep going!” wrote the co-founder.
This post “The old money is almost gone,” Huobi co-founder discusses the challenges of managing a $400 million VC fund
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