Andreessen Horowitz announced Thursday it raised a massive $2.2 billion for its third crypto asset investment fund dubbed Crypto Fund III. The venture capital giant raised more than its originally rumored amount of $1 billion, which later reported estimated at $2 billion.
Andreessen Horowitz' Chris Dixon, Katie Haun and Ali Yahya wrote: "This fund allows us to find the next generation of visionary crypto founders and invest in the most exciting areas of crypto. We invest in all stages, from early seed-stage projects to fully developed later-stage networks. [...] As with any new computing movement, crypto has endured a variety of challenges and misconceptions. That's why we are also bringing together heavy-hitters across several functions to help translate crypto to the mainstream." The firm's previous fund was unveiled in April 2020 with $515 million in initial capital. An early investor in Coinbase
Here is the rest of the week in review:
U.S. crypto exchanges and custodians have proposed a solution to the challenges of digital assets' compliance with anti-money laundering rules. A team of engineers from BitGo, Coinbase, Gemini, Kraken, and Fidelity have devised a solution to how to share customers' personally identifiable information when regulated firms transfer crypto assets, a provision known as the Travel Rule. The version 1.0 of the proposal came as the Financial Action Task Force completed a review of progress made by the crypto industry across the globe, noting that most countries are lagging behind when it comes to compliance. The U.S. Travel Rule Group expects to begin sending transactions accompanied by real customer data by the end of the fourth quarter, and virtual asset service providers are still working on a method of address attestation that will be added to version 1.5 of the organization's Travel Rule solution.
Boston Federal Reserve President Eric Rosengren on Friday warned that the Tether (USDT) stablecoin poses a risk to the stability of the financial system. He listed Tether in a list of "financial stability challenges" the U.S. central bank is monitoring, noting the controversial stablecoin is one of the "new disruptors" to short-term credit markets. Rosengren further explained in an interview: "The reason I talked about Tether and stablecoins is if you look at their portfolio, it basically looks like a portfolio of a prime money market fund but maybe riskier." He added that the Federal Reserve should think more broadly about potential disruptions to credit markets, including risk from stablecoins. Rosengren warned that unregulated stablecoins like Tether are growing to become a more important part of the economy and regulators should study capital flight from similar financial instruments. Tether plays a key role in the global crypto market despite its contentious accounting.
Crypto prices dipped to $1.3 trillion this week amid heightened fears of a prolonged bear market. For the majors, all except stablecoins fell. In the top 100, the biggest losers were Kusama (KSM), down 48%, NEAR Protocol (NEAR), down 37%, and Fantom (FTM), down 35%. The biggest gainers were Celo (CELO), up 43%, and Quant (QNT), up 8%. Next week traders will watch if Bitcoin (BTC) breaches the key $30,000 level.
The author owns a small amount of BTC.
