The startup-focused arm of major private equity investor Bain Capital launched a $560 million fund to invest exclusively in crypto companies.
The fund closed in November, and has already invested $100 million in the crypto space, Bloomberg reports. Bain is no stranger to cryptocurrencies, with holdings in crypto lenders BlockFi and Compound Finance, as well as Digital Currency Group, which runs a host of different crypto companies.
The fund will invest in companies ranging from crypto startups to decentralized autonomous organizations. Bain expects to deploy the fund in the next two to three years, and will adopt a long-term approach to investment.
“Our view is that this is a 10-20-year opportunity, and we are building a platform here that we think can facilitate multiple funds over a period of time,” Stefan Cohen, a managing partner at Bain Capital Crypto told Bloomberg.
Fund launched at a volatile time for crypto
Bain’s latest foray into crypto comes at a volatile time for the space, with rising inflation, Russia-Ukraine tensions and concerns over an upcoming Federal Reserve rate hike causing wild swings in the market. Total crypto market capitalization has fluctuated by about $400 billion since mid-February, according to data from coinmarketcap, while Bitcoin had until recently halved from a record high struck in November.
But Bain’s investment highlights the growing institutional interest in crypto, which has seen market capitalization blow up since 2021. Several Wall Street giants, most notably Tesla, have large holdings in Bitcoin. Fund operators including Greyscale, Van Eck and more recently, Charles Schwab, have also attempted to launch crypto-related financial products.
Several major firms, including Paypal, as well as e-commerce major Overstock already accept crypto. Recently, Ebay said it could begin accepting crypto payments by as soon as this month.
Institutional funds have been steadily pouring money into crypto, indicating that even despite global ructions, the space remains attractive.
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