Lightspeed Faction launches $285M crypto fund amid general VC downturn

The co-founders of the fund have said that they want to spend the vast majority of the fund’s remaining resources in infrastructure and protocol-level initiatives.

The Menlo Park-based firm Lightspeed Faction said Thursday that it had raised $285 million to invest in early-stage cryptocurrency startups.

The co-founder of Faction informed Blockworks that the majority of the fund’s $285 million is still available despite the fact that the company has signed twenty partnerships, most of which have not been made public.

Midway through 2022, Lightspeed Venture Partners and Faction came out with Lightspeed Faction, a blockchain-focused joint venture. Their first venture capital fund.

Co-founder Samuel Harrison mentioned wallets and brokerages, developer tools platforms, and remittance services as examples of the kinds of infrastructure and protocol-level businesses that attract Faction’s investment arm.

Banafsheh Fathieh, the other co-founder of Faction, stated, “The TL;DR is we’ve been really focused on the plumbing.”

In July of 2023, Fathieh stated, the fund was shut off. The revelation from Faction comes at a time when VCs are feeling pessimistic about the cryptocurrency market. Since the beginning of 2022, the total amount of crypto venture money has decreased in five of the six quarters.

“A common story is that capital has dried up. Our dedication to cryptography is unwavering. We aren’t some kind of fund that invests in cutting edge tech. Fathieh emphasized that his firm will remain focused on blockchain-related investments.”

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