Founders Fund, the venture capital firm founded by billionaire entrepreneur Peter Thiel, is making significant waves in the cryptocurrency space once again. Sources reveal that the renowned Silicon Valley firm has rekindled its interest in digital assets, allocating $200 million to invest in crypto tokens, with a 50-50 split between bitcoin and ether. This move, which occurred from late summer to early fall last year, highlights the renewed enthusiasm among institutional investors for the burgeoning cryptocurrency markets.
The previously undisclosed investment by Founders Fund is a notable indicator of Silicon Valley’s return to token investments, a strategy that was once the hottest trend before the crypto market faced challenges in 2022. The fund’s decision to allocate substantial funds to both bitcoin and ether underscores a growing confidence in the recovery and potential of the crypto markets.
The cryptocurrency landscape experienced a tumultuous period in 2022, marked by the collapse of major players like FTX and a subsequent regulatory crackdown. The fallout led to a significant market downturn, with bitcoin plummeting to nearly $15,000, its lowest price since 2020. However, the past year has witnessed a gradual resurgence in the prices of both bitcoin and ether. Bitcoin recently surpassed $50,000 for the first time in over two years, though it still lags behind its peak of $69,000 in November 2021.
Founders Fund has a storied history in the crypto space, having been one of the earliest institutional investors in bitcoin. In 2014, the firm aggressively accumulated bitcoin, only to liquidate its holdings before the market downturn in 2022, securing approximately $1.8 billion in returns. The fund re-entered the crypto market last summer when bitcoin was trading below $30,000. Over the subsequent months, Founders Fund continued to build its crypto portfolio, adding both bitcoin and ether to its holdings.
With a track record of early bets on successful ventures such as SpaceX and Meta, Founders Fund has amassed over $12 billion in assets under management. The firm signaled its commitment to the crypto space by bringing on Joey Krug as a partner in April 2023, focusing specifically on crypto investing.
As Silicon Valley heavyweight Founders Fund doubles down on digital assets, its substantial investment in bitcoin and ether adds to the growing narrative of institutional confidence and resurgence in the cryptocurrency markets.
Digital Assets Desk