Finally, European VCs Are Introducing Cryptocurrency Funds

As crypto’s last bear market drew close, 1kx held an invite-only crypto summit. It was part of Berlin Blockchain Week 2019. 1kx is a crypto fund backed by Matter Labs, Gnosis and Qredo.

Lasse Clausen, a founding partner of 1kx, invited most of the venture investors he knew. The invitation was to inform them about blockchain technology. Only one person came.

European VCs To Start Launching Crypto Funds

According to Clausen, European VCs utterly ignored blockchain. The majority of venture capitalists, he said, were not required to purchase tokens under the terms of their limited partnership agreements.

Last year’s bull market has finally spurred European VCs to launch crypto funds. They are also trying to get a taste of token publicity. This is taking place as the blockchain industry in Europe continues to grow.

In terms of the worldwide proportion of blockchain venture capital, Europe overtook Asia. This was evident in this year’s blockchain venture capital’s second quarter. 

As other areas saw a decline, it increased by 25%, as reported by The Block Research. Despite having less available money, Dealroom metrics indicate otherwise. 

Dealroom metrics demonstrate how closely American and European venture businesses compete this year. This is in terms of the number of completed blockchain transactions. 

Web3 native venture enterprises in the area have also been expanding. A $160 million cryptocurrency fund was closed by Greenfield One in late 2017. 

The $120 million investment from Dutch company Maven 11 followed suit after the close completion. 

The Block announced in April that Fabric Ventures would complete two $245 million web3 funds. A $350 million crypto venture and fintech capital fund were also conducted by Fasanara Capital last month. 

In 2019, the London-based investment company Fasanara Capital introduced a liquid digital asset fund.

A Long-Standing Issue

Custody is an issue that venture companies still deal with in certain countries. It dates back to the invention of money. 

Hubert de Vauplane, an attorney at Kramer Levin, claims that very few EU-wide solutions are legally and commercially capable of opening an account for tokens.

In Paris, Vauplane shares leadership of the company’s alternative investment management division.

Most institutions reject it because they believe it to be too hazardous from an anti-money laundering standpoint, argues Vauplane. 

Vauplane emphasized that in addition to their refusal, they often shut a client’s account when they see them conducting a [token] capital raising.

Europe Is Adopting a Culture That Is Crypto-Friendly

Most of the investors The Block spoke to remain upbeat despite these difficulties. They predict that in the future years, the European cryptocurrency startup landscape will prosper.

According to Blossom’s Brown, the crypto sector in Europe has just “truly come alive.” She asserts that there is no underlying structural cause for the absence of multibillion-dollar crypto funds in Europe. 

She does believe that European cryptocurrency investors are slowly catching up to those in the United States.

Despite the recession, European businesses are still raising money. A record $20.1 billion has been raised by European companies in the first half of this year.

In an interview with The Block, UK company Northzone disclosed some details. According to Northzone, it would be willing to invest in DAOs and tokens. Last month, Northzone raised a $1 billion fund.

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