Axios Pro Exclusive Content

Hack VC raises $150M to invest in crypto startups

Feb 21, 2024
Illustration of a crypto block with an image of a one hundred dollar bill on one side.

Illustration: Gabriella Turrisi/Axios

Hack VC, a New York-based venture firm focused on crypto and digital assets, has raised a new $150 million fund to invest in early-stage startups, Ryan writes.

Why it matters: After the deep downturn in crypto funding in 2023, LPs are betting on a turnaround for the digital asset industry.

Context: Hack VC has invested in well-known crypto startups including Consensys, Mysten Labs, Republic and Amber Group.

  • It has also had a few flops, notably Terraform Labs, which was at the center of the 2022 crypto collapse, and BlockFi, which succumbed to that collapse.
  • The firm was founded in 2017 by Ed Roman and Alexander Pack and now touts $425 million in AUM.

Zoom in: Hack VC says it has also "set aside capital to support our protocols on-chain," in addition to its traditional equity-based venture investing.

Zoom out: Crypto startups raised $9.3 billion in VC funding last year, compared with $29.2 billion in 2022 and $24.8 billion in 2021, according to Pitchbook data.

  • That amount was spread over 1,643 deals during 2023, which was nearly half the deal volume of 2022, when Pitchbook counted 3,211 crypto deals.
  • In Q4 2023, the sector saw a slight turnaround, as startups raised $1.9 billion across 326 deals — which represented a 2.5% increase in capital invested over the prior quarter.

Yes, but: Crypto-focused VCs have continued to fundraise over the past 12 months, despite a slow market for deployment.

The bottom line: With several bitcoin ETFs finally approved and the market for digital assets on the rise, investors at the VC and LP level are betting on a crypto turnaround coming sooner rather than later.

Go deeper