HashKey Has ‘Weathered at Least Three Cycles.’ $500M Fund Is Latest Proof.

The notable fundraise comes as crypto markets continue to churn

January 17, 2023 04:47 pm

Source: Yu Chun Christopher Wong / BeeBright, modified by Blockworks

HashKey Capital has raised half a billion dollars for the cryptoasset manager’s latest vehicle.

The fund, HashKey Fintech Investment III, is designed to key in on “the growing opportunities in emerging [digital asset] markets,” the firm said in a statement on Tuesday.

It’s a notable $500 million haul in unsteady crypto markets, and the funds have been earmarked to invest in a number of cryptocurrency and blockchain initiatives globally — under that emerging markets focus. Limited partners, according to HashKey, include sovereign wealth funds and family offices.

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HashKey has “weathered at least three cycles in the industry,” according to Dennis Chao, the asset manager’s chief executive. The firm’s parent company, Hong Kong-headquartered HashKey Group, is known as a specialist in investing in blockchain projects in Asia and was an early backer of Ethereum — dating back to 2015.

“These unique experiences and insights will be invaluable to us in navigating through turbulence,” Chao said in a statement.

Chao’s firm has since backed a number of crypto projects that have since moved into the limelight, including Cosmos, dYdX, Animoca Brands and Polkadot. The cryptoasset manager launched in 2018.

HashKey Group inspired Ethreum’s upcoming “Shanghai Upgrade,” according to Xia Feng, the investment manager’s chair. Shanghai is slated as the next major upgrade for the Ethereum network and is designed to allow the proof-of-stake blockchain’s validators to withdraw their staked ether, the network’s native token.

The pending upgrade, which appears to be on track to occur in March, marks the first time validators — which verify transactions on the protocol — would mark the first time validators are able to cash in on their locked up ether, which has been accruing staking rewards. Ethereum hit half a million validators earlier this month as momentum builds toward Shanghai.

“We have maintained since the first day that the power of blockchain and crypto innovation can create a better future,” Feng said. “Fund III will follow our time-tested investment principles while also looking for game-changers, which would be those that will propel the industry forward into the next stage.”

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