Sequoia Capital's journey in crypto investments: previously invested in Huobi and Bitmain, and in the past six months has invested in at least 9 projects

Author: Gu Yu

Today, the famous venture capital firm Sequoia Capital changed its official Twitter bio to "We help bold people build legendary DAOs, from ideas to token airdrops." To the outside world, this is an important sign that Sequoia Capital is shifting its investment focus towards the crypto industry, represented by DAO organizations, and has sparked widespread discussion between the crypto and venture capital industries.

A few days prior, Sequoia Capital also decided to auction its 2005 YouTube investment memorandum as an NFT, which ultimately sold for 200 ETH (approximately $860,000). Earlier in October, Sequoia Capital stated in an announcement that it would increase its investment in crypto assets by reshaping its investment structure.

In fact, Sequoia Capital has a long history of investment in the crypto industry, but early investments were not primarily made by Sequoia Capital itself; rather, they were mostly made by Sequoia China.

As early as March 2014, Sequoia China invested several million dollars in Huobi at the company's inception. According to information disclosed by Huobi in 2018, Sequoia China held a 23.3% equity stake in Huobi, making it the second-largest shareholder after Li Lin.

Subsequently, Sequoia China continued to invest in projects such as Bitmain, Distributed Technology, Nervos Network, and Conflux. This year, it invested in the crypto financial services company Babel Finance and the blockchain game developer Animoca Brands.

In January of this year, Sequoia China became a strategic partner of the well-known crypto investment fund Dragonfly and completed an investment in the Dragonfly fund.

However, Sequoia China once had the opportunity in August 2017 to acquire about 10% of Binance at an $80 million valuation, but this investment could not be completed due to reasons on Binance's side. Afterwards, Sequoia Capital sued Binance, leading to an unpleasant dispute between the two parties. Now, Binance's valuation has soared to $200 billion.

Sequoia India also has several investment cases, having invested in the decentralized oracle project Band Protocol in February 2019, but there have been no other public crypto investment records in the following two years. This year's investment projects include the crypto asset management platform Coinshift (September this year), the decentralized derivatives project Clearpool (September this year), and the decentralized finance platform Beta Finance (November this year), most of which are early crypto projects. Recently, there have been rumors of plans to invest in Polygon.

As for Sequoia Capital itself, it also invested in a decentralized prediction market project, Veil, in January 2019, with participating institutions including the now well-known crypto venture capital firm Paradigm (founded by a former Sequoia Capital partner) and 1confirmation, but the project failed six months later.

In the following two years, Sequoia Capital had no other public crypto investment records. It wasn't until April of this year, when the decentralized social network BitClout disclosed its list of investors, that Sequoia Capital was included. After that, Sequoia Capital accelerated its investment pace in the crypto industry.

According to incomplete statistics, Sequoia Capital's subsequent crypto investment projects include the crypto custody institution Fireblocks (July this year), the crypto trading platform FTX (October this year), the Polkadot ecosystem DeFi project Parallel Finance (November this year), the Ethereum Layer 2 developer StarkWare (November this year), and the NFT social platform Pulsr (November this year). Among them, FTX is the largest project in terms of financing scale that Sequoia Capital participated in, raising $420 million at a $25 billion valuation.

It is foreseeable that mainstream venture capital firms represented by Sequoia Capital will further increase their investment in the crypto industry, bringing more funds and resources to crypto projects and promoting the further development and maturation of the industry.