Andreessen Horowitz Launches $300 Million Crypto Hedge, Hires Katie Haun

On June 25, Prominent Silicon-valley based VC firm Andreessen Horowitz has announced the launch of a $300 million crypto hedge fund. The announcement came just one day after Bitcoin briefly sank below $6000, the lowest point that it has seen this year.

The fund’s primary holdings will be in crypto-related startups in equity, crypto tokens, or convertible notes. Cryptocurrencies like Bitcoin and Ethereum will also be included.

Time to buy the dip?

The firm has reportedly been investing in crypto assets for years, but was limited to keep their digital holdings to a 20 percent limit of ‘non-qualifying investments’ on its general fund.

Former Prosecutor Katie Haun Joins to Co-Lead the Fund

The fund will be led by long-time partner Chris Dixon and a new addition to the firm, Kathryn Haun. Haun is the former federal prosecutor who worked intensely on the takedown of two infamous crypto businesses: the Silk Road network and the notorious BTC-e exchange. Haun is also the firm’s first ever general partner who happens to be a woman. Haun originally caught the attention of the firm when she joined the board of Coinbase last year.

.@bhorowitz quoting Nicki Minaj in his blog announcing @katie_haun as the VC firm’s newest (and first female) general partner. pic.twitter.com/Wb2lhgadkL

— melody hahm (@melodyhahm) June 25, 2018

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Haun told Axios that her interest in cryptocurrencies originally started after leaving her position at the Department of Justice, during her tenure as a professor at Stanford. “I think becoming [a venture capitalist] is just a natural part of my transition,” she said.

Precarious Timing?

The timing of the fund’s launch could be seen as precarious. Cryptocurrency markets have shed billions since the beginning of the year, with little sign of any short-term recovery.

In fact, the Financial Times reported in mid-June that cryptocurrency hedge funds were down by 35 percent since January, and that only 8 percent of the top 25 crypto hedge funds had reported any profits at all. At least nine crypto hedge funds have shuttered their operations this year.

Indeed, Dixon acknowledged that the initiative could be precarious: “I would argue that going heavy into crypto was already kind of risky.”

However, “I think it’s working out well,” he said. “This is not a marketing thing to have a separate fund here. There are genuinely reasons to have it.”