Pantera nears $175M target for its new venture fund — here are the main takeaways from its March investor letter

Frank Chaparro
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Pantera Capital, the California-based digital asset investor, is close to nearing the $175 million target for its a new venture fund, the firm said in an investor letter out Wednesday.

Already, it has raised $160 million for the aptly named Venture Fund III, which has put some capital to work, according to the letter. Pantera said it expects the fund to make a total of 35 deals across the market. The firm also hinted at where it might be looking to get in on deals, noting opportunities in the market for cryptocurrency exchanges, as an example.

"Some of the most successful investments in our previous two venture funds have been cryptocurrency exchanges and we still think there’s opportunity to invest in them," the firm said. The company, which is led by Dan Morehead, is an investor in Bakkt, the digital currency trading platform backed by Intercontinental Exchange, the Atlanta-based futures and equities exchange operator.

As per the letter, which breaks down Pantera's investments by category, 29% of its Venture Fund III capital has been invested in exchanges. The firm is looking to invest in institutional exchanges such as Bakkt, but also startup firms that can help crypto take off in new regions, according to the letter.

"Think of it like a market control bet on crypto: if crypto starts to take off in that jurisdiction, we’re almost guaranteed a slice of the pie because we’ve invested in the best exchange in that geography," the firm said. "We’re focused 100% on that, to gain a foothold and do quite well. Our (undisclosed) Investment in a leading cryptocurrency exchange in Latin America is one of these."

The firm is also eyeing opportunities in infrastructure companies that are building tools and services for developers. It has made 4 investments in this space, including Staked, a staking provider, and StarkWare, a firm that offers scalability tools. The firm also noted that 35.1% of its invested capital are made of infrastructure projects.