Galaxy Digital's $100M Fund Targets Crypto Startups Amid Rally

Galaxy Digital to launch $100M venture fund, signaling a resurgence in crypto venture capital with plans to back up to 30 startups.

By Alex P. Chase

4/3, 18:57 EDT
Bitcoin / U.S. dollar

Key Takeaway

  • Galaxy Digital, led by Mike Novogratz, is raising a new $100 million venture fund targeting outside investors for crypto startups.
  • The fund will focus on infrastructure, decentralized finance, and payments with a minimum startup investment of $1 million.
  • This move signals a broader revival in venture capital interest in the crypto sector amid a Bitcoin rally and growing investor enthusiasm.

Galaxy Digital Eyes $100M Venture Fund

Michael Novogratz's Galaxy Digital is making headlines with its plans to raise a new venture fund, Galaxy Ventures Fund I, LP, targeting a hefty $100 million, primarily from outside investors. This marks a significant pivot from Galaxy's previous strategy of investing its own capital into crypto startups, focusing on areas like infrastructure, decentralized finance, and payments. The fund aims to invest in up to 30 startups over the next three years, with a minimum investment threshold of $1 million per startup. This move is not only a testament to Galaxy's commitment to fueling the digital asset ecosystem but also signals a broader revival in venture-capital investments into the crypto sector.

Venture Capital's Crypto Comeback

The crypto venture capital scene is experiencing a cautious yet palpable resurgence. Amidst a steep Bitcoin rally and renewed interest from both retail and institutional traders, venture capitalists are racing back into the fray. Notably, Hack VC is raising at least $100 million for another fund targeting seed-stage investments in crypto startups, following a $150 million fund raised last month. This renewed enthusiasm comes after a significant downturn in 2023, where crypto startup funding plunged by more than two-thirds to $9.5 billion globally. However, with Galaxy Digital and others like Paradigm and Hack VC making bold moves, the tide appears to be turning.

Strategic Investments in Early-Stage Companies

Galaxy Ventures Fund I, LP, is set to focus on financial applications, software infrastructure, and protocols building in the crypto space. This strategic direction is underscored by Galaxy's history of investing $200 million into more than 100 projects over the past six years. The fund's aim to invest in as many as 30 startups over the next three years reflects a keen interest in nurturing the next wave of innovation within the crypto ecosystem. This approach not only diversifies Galaxy's investment portfolio but also positions it as a key player in shaping the future of digital assets.

Management Quotes

  • Galaxy Digital statement:

    "For years, we’ve been putting our own capital behind these innovators. Now we’re launching Galaxy Ventures Fund I LP to partner with outside investors, allowing us to continue fueling the digital asset ecosystem by backing promising early-stage companies."