By George Ward
In a Twitter post earlier this week, the co-founder of Houbi Global exchange, Du Jun, shared insights into his experience operating ABCDE Capital, a $400 million Web3 venture capital fund.
According to Jun, ABCDE Capital was created in March, and the firm was registered in Singapore by April. However, the May 2022 crash of Terra Luna caused many venture capitalists to flee the crypto market space.
Furthermore, Jun added that the Venture fund was fully operational in August, with a few partners investing in pools whose overall evaluation isn’t more than $10 million. However, initial reports in early November showed encouraging developments before the FTX crash caused another downturn in the crypto market.
Hence, Jun pointed out that the ongoing FTX contagion extended far beyond what most industries expected. According to Jun, salary cuts, layoffs, and contraction became a recurring theme in the crypto industry.
Initially, the competition between Binance and FTX made many assume that their competition could result in healthy development for the crypto industry. But it turned out that FTX was not competent enough and was ultimately affected by the crypto winter.
Against all odds, Binance exchange proved its competency as its operations weren’t affected by the crypto, and now it controls over 75% of the crypto market share. Jun suggested that the growth of DeFi came about as a result of crypto firms such as Coinbase, Grayscale Circle, and Paxos’ adoption of regulations.
This facilitated bigger institutional investors to become involved in the space.
Jun Attributes Crypto Chaos To FTX’s Implosion
The Huobi co-founder pointed to the defunct of the world’s third largest crypto exchange, FTX, as the cause of the market downturn and insolvencies in crypto. Jun also gave more highlights about ABCDE Capital.
He stated that since its launch in August, the crypto firm has added up to seven more companies to its portfolio in the zero-knowledge, data, security, social and non-fungible tokens (NFT) sector.
He further remarked that ABCDE only invests in about 15-20 crypto firms each year, noting that a good firm with a long-term plan is never frightened nor affected by a bear market swing.