American internet entrepreneur and Reddit co-founder Alexis Ohanian has raised $500 million across two new funds via his venture firm 776.
He expects to put most of this new money to work investing in crypto startups.
Ohanian told Wall Street Journal that crypto startups currently account for about 40% of 776's portfolio, including metaverse game Axie Infinity, crypto tax manager Coin Tracker, and Bitcoin rewards app Lolli, but crypto "will be the majority of the portfolio by the end of this year."
Ohanian's bullishness for crypto is inspired by the fact that the sector is currently a magnet for promising software developers, and he's not wrong.
According to venture firm Electric Capital's Developer Report for 2021, 18,000 monthly active developers committed code in open-source crypto projects throughout the year, and some 34,000 new developers committed code in 2021—the highest number to date.
The Reddit co-founder says of crypto's promising recruitment drive that "talent has never led me wrong."
He also hopes to encourage projects that don't outwardly tout themselves as blockchain-based but utilize crypto's underlying tech regardless. Said Ohanian: "What excites me about crypto are all of the things that no one would know is crypto."
VC model under fire
After last year's Bitcoin bull run pushed many cryptocurrencies to new all-time highs, venture capitalists have been throwing their hats in the ring the last year.
But crypto is rooted in the ideals of decentralization, which are at odds with the world of venture capital, where companies with significant share holdings can exert a controlling influence over projects.
At the end of last year, former Twitter CEO and unabashed Bitcoin-maxi Jack Dorsey attacked VC giant Andreessen Horowitz (a16z) and its allies for—as he sees it—being at odds with the fundamental spirit of crypto.