Multicoin Capital, a crypto trading firm that invests in token and blockchain companies stated that the collapse of FTX will eventually bring down many blockchain firms in the weeks to come because many of them invested heavily in FTX.
According to CNBC, the investment firm stated in a letter to its investors that the crypto market will get worse before it eventually picks up due to the decline of price in the ecosystem amidst the fallout of FTX.
The crypto venture company added that Multicoin’s holdings have decreased by 55% this month. Multicoin said it may eventually write down its investment with FTX to zero because they are tied to bankruptcy procedures, a move similar to other outfits like Temasek. The company, however, believes that there is still hope to recover some of its funds from the defunct FTX.
Multicoin managing partners Kyle Samani and Tushar Jain wrote in a letter that Multicoin invested too many funds with FTX because Multicoin were too confident in their relationship with FTX.
Multicoin said that the firm currently does not have any other funds exposed to any other exchange. Coinbase will however be the firm’s chief custodian as the firm continues to examine the current market repercussions.
Multicoin Investing in Blockchain Technology
Multicoin is a crypto investment company that invests in both private equity and tokens for projects that are yet to launch in addition to managing liquid cryptocurrency asset portfolios.
The firm claims to support entrepreneurs through several rounds of funding in both private and public markets. Major Blockchain firms that have partnered with Multicoin over the years include Paxos, FTX, Bakkt, and Helium.
In July, the venture capital firm announced the launch of a $430 million venture fund to invest in early startup firms involved in Web3 infrastructure, open finance, and consumer products.
Multicoin added that it has recently made investments in the fundamental Web3 infrastructure, including Ceramic and Fluence, as well as a few others that it has not yet disclosed. The firm highlighted that it would invest in more Decentralized Finance (DeFi) projects because a lot of markets can be rebuilt by utilizing Defi rails.
I'm excited to announce that Multicoin has accumulated a large position in $RUNE and share our research report on THORChain.
THORChain provides a trust-minimized way to trade spot tokens (not just derivatives) across blockchains.
— Tushar Jain (@TusharJain_) February 23, 2021
In a similar situation, Multicoin announced that it gathered a large position in RUNE tokens. The firm stated that the THORChain is fit for the crypto market and believes that investment in RUNE tokens is the best way to invest in crypto because it believes projects that are built on them will continue to soar in the forthcoming years.
