The New York-based venture capital firm, Union Square Ventures has announced new investments, including US exchange Coinbase, writes CNBC.
In a week when a competing venture capital firm, Andreessen Horowitz, announced its first-ever fund dedicated to crypto companies, Managing Partner at Union Square Ventures, Albert Wenger has said his company won’t take the same route, stating, “We see a lot of upside to keeping it under the same roof.”
Although the company has no plans to create a separate fund as some of its VC competitors have, it sees big profits in the future:
“Investors are rationally pouring a lot of money into this sector because I think people are seeing the winning blockchain here might be worth a trillion, or a couple of trillion dollars,” Wenger said. “It’s not at all crazy to think that.”
Wenger says that he sees the real profits being generated from putting resources into supporting applications rather than the apps themselves, agreeing with Apple co-founder Steve Wozniak that early investors in similar ventures may beat the risk of another bubble burst, this time blockchain style. Wenger admits that many projects are doomed to failure but the odd one if it is successful, can be huge.
Wenger referred to scams and failed ICOs, which have amounted to over 1,000 this year does the industry little good:
“You’ve had a series of ICOs where investors have purchased at steep discounts — the second it starts trading those investors cash out, they make a handsome return, and someone else is left to hold the bag,” he said adding that interesting projects are succeeding on far fewer funds.
Wenger admits to personally holding Bitcoin and his company has invested over the year watching its value drop by 60%. As for the future of the market, he feels investing in only one currency would be a mistake:
“The stuff that actually works will float to the top,” he said. “It might take a while, but time will tell.”
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