How to “lose” billions of dollars with cryptos while winning: a16z did it
Losing bet? – The intensity of the fall of the crypto market in recent months has been matched only by that of euphoria from bull market of 2021. While many small crypto investors can get drunk at the worst possible time, some investors institutional didn’t do better even much worse. If it limits damage well, the venture capital fund Andreessen Horowitz (a16z) is among those who have suffered greatly from the recent decline.
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Andreessen Horowitz ‘loses’ billions from crypto in 6 months
Professional traders know very well that no matter how long or how big a position is, it’s all about taking it. at the right time. Obviously, and despite its experience, the fund Andreessen Horowitz completely missed this good timing.
As the reports the Wall Street Journal (WSJ) on October 26, the venture capitalist indeed launched his new cryptocurrency funds, special “Web3”in May 2022, while Bitcoin (BTC) and the crypto asset market were starting to show worrying signs.
The a16z cryptocurrency fund has made a all in impressive of $4.5 billion at the time. But the crypto winter and disasters like the stablecoin UST de Terra (LUNA) have been there. The total of his crypto investments then amounted to 7.6 billion in total.
Not sold… not lost
According to ” people close to the case ” (but anonymous therefore) cited by the WSJ, the entire crypto fund of Andreessen Horowitz launched since 2018 would have lost 40% of its value (unrealized losses) during the first half of 2022. This would therefore potentially be billions of dollarseven if the WSJ is careful not to give precise figures, given its anonymous sources.
But looking only at the last few months doesn’t show the big success from a16z global crypto investment since 2018. Indeed, at the end of 2021, Andreessen Horowitz had “multiplied its initial investment by 10.6 times”. So even with the current crypto winter and the 50-60% loss in BTC price since then, the venture capitalist still has to be a nice +400 to 500% on its initial investments in 4 years (if we exclude the last Web3 fund of May 2022).
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