The well-known venture capital firm Andreessen Horowitz (abbreviated as a16z) launched a new crypto fund worth $515 million less than a month ago. However, the company made a bold prediction for the entire crypto industry. According to a16z, a large number of high-quality projects may emerge, triggering another round of growth cycle in the crypto industry.
Speech on the Price Innovation Cycle
The venture capital fund, which now has a large portfolio of crypto assets befitting its rather notable reputation, speculated in a blog post published on Friday that some of the better projects that emerged after the 2017 ICO boom will contribute to another boom.
To support this view, a16z cited data and "anecdotal" evidence going back a decade. The fund explained the concept of "price innovation cycles," noting that these peaked in 2011, 2013, and 2017.
According to the fund, these cycles begin with rising prices, which attract new people with innovative ideas to the crypto space and create promising projects and companies that benefit the entire crypto space through their innovations.
As the basis for another growth spurt
The key element of these cycles is their self-replicating nature, the blog post explains. In short, these cycles set the stage for the next cycle to develop by incentivizing more people with ideas to join the crypto space. For example, Ethereum was born in the 2013 cycle, which itself became the cornerstone of the ICO boom, which in turn led to the 2017 cycle.
Therefore, a16z explained that the 2017 cycle produced a series of exciting projects, including finance, payment, games, web applications, infrastructure, etc. A large part of these projects are about to be launched in the near future, which may drive the arrival of the fourth crypto cycle.
Building on the success of previous projects
The blog post comes nearly three weeks after the firm completed raising its second crypto fund. In a public statement, a16z said the fundraiser exceeded its initial $450 million goal and will now invest a total of $515 million across the crypto industry.
While the firm launched its first fund in 2018, its investment prospectus is broader in scope. However, a16z said the new fund will target specific areas of the crypto industry. These areas include next-generation payments, decentralized finance (DeFi), and Web 3, the concept of a decentralized internet.
Join our Telegram channel to stay updated with breaking news coverage.
English 
Chinese (China) 
Chinese (Hong Kong) 