Dragonfly Capital Raises $650M Crypto Fund Amid Bear Market Slump

Crypto venture capital firm Dragonfly Capital has closed a $650 million fourth fund, marking one of the largest crypto VC raises in recent months despite a prolonged downturn in the digital asset market. Managing Partner Haseeb Qureshi announced the milestone, acknowledging the challenging environment defined by falling token prices and cautious investor sentiment.

Qureshi described the current crypto market as overshadowed by bearish momentum and low morale. However, he emphasized that Dragonfly has historically raised capital during market downturns, including the 2018 ICO crash and shortly before the 2022 Terra collapse. According to him, those prior fund “vintages” ultimately delivered some of the firm’s strongest returns, reinforcing confidence in long-term blockchain investment strategies.

The new $650 million fund surpasses the firm’s earlier target of $500 million disclosed in September and will primarily focus on early-stage crypto startups. In May 2023, Dragonfly raised another $650 million fund aimed at later-stage blockchain companies. This latest vehicle signals continued conviction in digital assets, even as venture funding across the crypto sector has slowed significantly.

Bitcoin has fallen roughly 46% from its all-time high of over $126,000 in October last year, contributing to a broader crypto market decline that has erased more than $1.4 trillion in total market capitalization. Despite this slump, Qureshi remains bullish on crypto’s financial use cases, arguing that blockchain-based financial infrastructure is expanding rapidly.

Dragonfly Capital is increasingly focused on stablecoins, decentralized finance (DeFi), tokenization, on-chain payments, and prediction markets. Portfolio companies such as Polymarket, Ethena, Rain, and Mesh reflect this strategy. Industry peers, including Pantera Capital and Maximum Frequency Ventures, have echoed similar views, emphasizing investment in stablecoins and tokenized assets while selectively exploring AI and prediction markets.

Qureshi called the new fund Dragonfly’s “biggest bet yet” that the crypto revolution remains in its early stages, positioning the firm to capitalize on long-term growth in blockchain technology and digital finance innovation.