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Sources have disclosed that Founders Fund, the venture capital firm established by billionaire Peter Thiel, is once again delving into Bitcoin and Ether, indicating a resurgence of interest in cryptocurrency markets within Silicon Valley.
Rekindling Institutional Interest in Cryptocurrency
According to two sources privy to the matter, from late summer to early fall last year, Founders Fund allocated $200 million towards acquiring crypto tokens, evenly distributed between Bitcoin and Ether, the two foremost cryptocurrencies in the market.
This previously undisclosed move underscores a notable return of institutional investors to token investments, a strategy that was once at the forefront before the crypto market encountered turbulence in 2022.
The substantial investment reflects a notable resurgence for crypto markets, which endured a challenging period in 2022 following the collapse of major players like crypto exchange FTX, leading to plummeting prices, industry reputational damage, and subsequent regulatory scrutiny. During this tumultuous period, the price of Bitcoin plummeted to nearly $15,000, its lowest value since 2020.
Founders Fund's Crypto Journey and Strategic Investments
As one of the earliest institutional players in the crypto arena, Founders Fund initially embarked on aggressive Bitcoin acquisitions in 2014. It liquidated its holdings before the 2022 market downturn, yielding approximately $1.8 billion in returns.
Last summer, the firm resumed its crypto accumulation, initiating purchases of Bitcoin when prices were below $30,000, gradually expanding its portfolio to encompass both Bitcoin and Ether over several months.
According to Channel News Asia, while the precise average acquisition prices remain undisclosed, the move signifies a significant vote of confidence in the resilience and potential of the crypto market.
Notably, Peter Thiel's public endorsement of Bitcoin, citing its attributes as a store of value akin to gold and a hedge against conventional monetary policies, aligns with his broader interests in libertarianism, minimal government intervention, and technological innovation.
According to Market Screener, despite requests for comment, a spokesperson for Founders Fund opted not to provide additional information regarding the investment decisions.
With a track record of early investments in pioneering entities such as SpaceX and Meta, Founders Fund has emerged as a prominent figure in the venture capital landscape, now boasting assets under management exceeding $12 billion.
Moreover, Joey Krug's recent addition as a partner in April 2023 underscores the firm's intensified focus on crypto investing, reflecting its commitment to navigating the evolving landscape of digital assets.
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