The world’s largest cryptocurrency exchange platform Binance, like a number of other cryptocurrency platforms, is launching its venture capital fund called Binance Labs.
On Wednesday, Binance Labs announced that it had secured $500 million to debut its startup fund aimed at investing in blockchain and Web3. The funding was received from a number of investors including DST Global, Breyer Capital, etc.
With the funds, Binance will be investing in Web3-focused companies. Web3, like how cryptocurrency, NFTs, and other things that made waves did, is the buzz of today. Web3 is an idea for a new iteration of the World Wide Web-based on blockchain technology, which incorporates concepts such as decentralization and token-based economics, according to Wikipedia.
Binance Labs’ debut comes at a time when the cryptocurrency market is experiencing a decline with Bitcoin losing more than 50 percent of its value from its November all-time-high of $69,000. This has caused losses for cryptocurrency firms as they’ve had their shares plummet as investors are scared of the market and that the decline will seep into privately-held crypto startups.
According to Binance Labs’ Executive Director of Investments and M&A Ken Li, while there’s been a slowdown in startup valuations of $1 billion and above, “there’s no current impact in early-stage private markets.”
Like other crypto venture funds, Binance Labs wants to leverage on the next big thing in tech –Web3. The company plans to invest in pre-seed, early-stage, and growth equity rounds of Web3 companies. Binance Labs will also invest in tokens and shares. “We are looking for projects with the potential to drive the growth of the Web3 ecosystem,” Ken Li said.
Speaking on the venture fund, Ken Li said that Binance Labs “always does its due diligence and has a strong conviction in its investment strategy. We know that investing in the early stages involves risks. The industry is still young and was younger back then.”