Sequoia Cuts Crypto Funds by $400M: Report

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• Sequoia Capital has decided to reduce its exposure to cryptocurrencies, according to a confidential source.
• The decision was accompanied by an equally large cut to the venture capital sector overall, reducing the cryptocurrency fund from $585 million to about $200 million.
• To avoid the fate of SVB, Sequoia has also downsized its so-called ecosystem fund, which invested in other tech sector startups, to $450 million.

Sequoia Reduces Crypto Fund by Almost $400 Million: Report

Reduction of Exposure

Sequoia Capital, an investment firm long revered for its direct involvement with Silicon Valley’s intricate web of venture capitalists and tech sector visionaries, has decided to reduce its exposure to cryptocurrencies, according to a confidential source.

Reflection of Market Conditions

In a message to investors, Sequoia Capital announced its decision to reduce its cryptocurrency fund from $585 million to about $200 million as reported by the Wall Street Journal. According to Sequoia, the pivot is a reflection of current market conditions in which low-interest loans have gutted through much of the tech industries’ wild spending.

Ecosystem Fund Downsized

In order to avoid the fate of SVB (Silicon Valley Bank), Sequoia has also downsized its so-called ecosystem fund which invested in other tech sector startups from $900 million to $450 million.

Lower Expectations for Returns

The two downsized funds were originally announced back in February 2022 and were already part of a restructuring plan imposed by Sequoia at that time due to expectations that returns would be lower than initially anticipated.

Strategic Cognition for Future Growth

Sequioa’s decision marks an important shift in their investment strategy and suggests that they are taking a more strategic approach when it comes investing in crypto assets rather than simply responding with volatility or apathy towards market conditions. This shift could result in future growth opportunities if managed properly going forward.