Castle Island Ventures Raises Hundreds of Millions For New Fund

The fundraising haul reflects continued institutional investor demand for private market blockchain plays

article-image

Nic Carter; Blockworks exclusive Art by Axel Rangel

share

key takeaways

  • The firm is expected to finalize its fundraise in the next couple of weeks, sources said
  • Castle Island has previously hit on winning VC stakes in companies including Bitwise and BlockFolio

Cryptocurrency venture capital firm Castle Island Ventures has raised hundreds of millions of dollars for its latest fund as institutional investors continue to plow capital into the space, despite record valuations. 

The huge fundraising haul reflects Castle Island’s track record of investing early — often in pre-seed or seed rounds — in some of the most successful crypto companies in the industry, according to three sources familiar with the matter who confirmed the fundraise.

Sources were granted anonymity to discuss sensitive business dealings. The precise amount raised isn’t known, and the firm declined to comment.

The new fund remains open to investors, sources said, though it’s expected to finalize its capital-raising haul in about two weeks. In the meantime, Castle Island is working to finalize commitments from a number of large investors. 

The fund, Castle Island Ventures III, is the third for the firm, which also engages in co-investment opportunities with its limited partners. This time around, sources said, Castle Island scored larger institutions as investors, branching out from the high-net worth individuals and family offices that have traditionally backed private digital asset plays. 

The third fund is set to follow the strategy of the firm’s first two vehicles — at least for the most part. Those funds earmark about 20% of capital to early-stage tokens, often coming in and investing before the token launches. 

“On one hand, these valuations are crazy high,” one source said. “On the other, LPs are looking for experienced, winning managers that can still derive a ton of alpha from this space.”

Massachusetts-based Castle Island’s portfolio includes the likes of Bitwise, BlockFi, Casa, ErisX, Matrixport, MoonPay and River Financial. 

Castle Island is led by co-founders and managers Matthew Walsh and Nic Carter, both veterans of Fidelity’s crypto investment operations. Sean Judge, formerly of Highland Capital, is a general partner.

It would likely go down as one of the largest so far this year, even as firms including Brevan Howard set up their own operations, which are expected to take in large amounts of capital.


Start your day with top crypto insights from David Canellis and Katherine Ross. Subscribe to the Empire newsletter.

Explore the growing intersection between crypto, macroeconomics, policy and finance with Ben Strack, Casey Wagner and Felix Jauvin. Subscribe to the On the Margin newsletter.

The Lightspeed newsletter is all things Solana, in your inbox, every day. Subscribe to daily Solana news from Jack Kubinec and Jeff Albus.

Tags

Upcoming Events

Salt Lake City, UT

MON - TUES, OCT. 7 - 8, 2024

Blockworks and Bankless in collaboration with buidlbox are excited to announce the second installment of the Permissionless Hackathon – taking place October 7-8 in Salt Lake City, Utah. We’ve partnered with buidlbox to bring together the brightest minds in crypto for […]

Salt Lake City, UT

WED - FRI, OCTOBER 9 - 11, 2024

Pack your bags, anon — we’re heading west! Join us in the beautiful Salt Lake City for the third installment of Permissionless. Come for the alpha, stay for the fresh air. Permissionless III promises unforgettable panels, killer networking opportunities, and mountains […]

recent research

Research Report Templates.png

Research

ZKPs enable efficient offchain transaction processing and validation, resulting in increased throughput and reduced fees. Solana's ZK Compression leverages ZKPs to minimize onchain storage costs, while Sui's zkLogin streamlines user onboarding by replacing complex key management with familiar OAuth credentials.

article-image

The crypto asset manager lowered its planned fee from 0.25% to 0.15%, undercutting its competitors

article-image

Plus, a look at planned ETH ETF fees and how they differ from their BTC counterparts

article-image

North Korea suspected in breach of Indian exchange’s multisig wallet

article-image

Plus, Sanctum’s CLOUD token has officially launched — but not without problems

article-image

It’s not yet clear whether Donald Trump is pumping bitcoin. But an unofficial memecoin is still seeing benefit.