Multicoin Capital, the crypto investment firm known for its backing of multiple Web3 and DeFi projects, announced its third $430 million venture fund.
Multicoin plans to use the fund for investments in projects that are “poised to reshape massive consumer-facing markets.”
Last year, Multicoin closed its second $100 million venture fund with a major focus on Web3 projects building on the Solana blockchain.
Now the firm outlined several other areas it says it is most excited about, including projects that fit into its “proof of physical work” investment thesis.
According to Multicoin, projects that fall into that category can be described as the ones that “incentivize people to do verifiable work that builds real-world infrastructure.”
The firm pointed to the two most notable “proof of physical work” projects it already has in its portfolio—decentralized wireless network Helium and Hivemapper, a Solana-based decentralized digital mapping network—adding that it is “increasingly interested in this space” and is looking for projects capable of "disrupting incumbent industries with this model."
Hivemapper, which incentivizes users to drive around and record their surroundings via dashboard-mounted cameras to create navigation maps, raised a $18 million Series A round led by Multicoin in April this year.
Permissionless data aggregation
Another area the Austin-based firm is paying enhanced attention to are the so-called DataDAOs—decentralized entities that are based on “a spiritually similar idea to Proof of Physical Work,” but focus primarily on data rather than physical infrastructure.
Multicoin argues that there’s a lot of fragmented data that “would be more valuable than the sum of the parts” if aggregated; however, collecting that data together is impossible “because it’s either too sensitive or personal, or because the aggregators are not subject to governance by users.”
The investment firm believes that crypto can help to solve these issues as it allows to create both stronger incentives for users to contribute data and permissionless data intermediaries, as well as by transferring the governance authority “from the hands of a few to a community of many.”
Other domains Multicoin is looking to use the fresh funds include projects offering creator monetization through online platforms that use crypto for payments, DeFi apps, NFTs, and social tokens, as well as building crypto-native consumer products.
The firm added that as one of the most active investors in core Web3 infrastructure since 2018, it also plans to continue backing this area and will soon reveal several new projects in its portfolio.