The startup arm of prominent private equity investor Bain Capital has formed a $560 million crypto fund.
The fund closed in November and has already invested $100 million in the crypto market. With ownership in crypto lenders BlockFi and Compound Finance, as well as Digital Currency Group, which oversees a number of different crypto startups, Bain is no stranger to cryptocurrencies.
The fund will invest in crypto businesses as well as decentralised autonomous organisations. Bain plans to deploy the cash over the next two to three years, with a long-term investment strategy.
Bain’s latest move into crypto comes at a tumultuous time for the industry, with growing prices, Russia-Ukraine tensions, and fears of a Federal Reserve rate hike generating violent market swings. According to data from coinmarketcap, the whole crypto market valuation has varied by about $400 billion since mid-February, while Bitcoin has recently halved from a record high set in November.
However, Bain’s investment demonstrates institutional interest in cryptocurrency, which has seen its market valuation skyrocket since 2021. Several Wall Street titans, most notably Tesla, have significant Bitcoin holdings. Greyscale, Van Eck, and, most recently, Charles Schwab have all tried to offer cryptocurrency-related financial products.
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