ABCDE Press the pause button, what is the current survival situation of Chinese VCs?

Author: Nianqing

Recently, Du Jun, co-founder of ABCDE, officially announced that ABCDE Capital has stopped investing in new projects and suspended the fundraising plan for the second phase of its fund, while also announcing the launch of a new incubator product, Vernal. ABCDE has made 19 investments in the past year, which is not particularly conservative. Despite having ample ammunition, it still cannot resist the current dull crypto market.

Since the revolution of FUD VC began, Crypto VC has pressed the pause button under hellish difficulties. Some have chosen to refrain from making new investments and only retain core personnel to maintain post-investment services, while some VCs have started to seek transformation towards secondary investments, project development, incubators, and crypto marketing.

Compared to their European and American counterparts during the same period, Asian VCs seem to be more conservative. Lao Bai, a research partner at ABCDE, raised a question a month ago—why are we in Asia "silent" while Europe and America are still "firing"? What is their reason for daring to "pull the trigger" on valuations? He speculated that the reasons may include different exit cycles, different investment decision-making processes, and the fact that Asian VCs are more concerned about returns, while their European and American peers are more idealistic and long-term oriented.

Furthermore, according to investor data from the RootData platform, most VCs in Chinese-speaking regions have adopted a more conservative investment strategy over the past year, with fewer than 10 investments. However, leading venture capital firms such as Animoca Brands, OKX Ventures, HashKey Capital, SNZ Holding, Waterdrip Capital, Mask Network, Nomad Capital, and NGC Ventures still maintain high-frequency trading, with over 20 investments in the past year. IOSG Ventures, Fenbushi Capital, SevenX Ventures, LongHash Ventures, and PAKA have also made more than 10 investments in the past year, but their investment frequency has significantly decreased compared to the previous year.

This article reviews the current situation of major Chinese-speaking VCs or VCs founded by Chinese people that have made fewer investments in the past year.

(Note: The data in this article is based on publicly disclosed investments and does not exclude the possibility of undisclosed internal operations or investments, which may differ from actual investment data.)

Continue Capital

Continue Capital, founded by crypto OG Pima, has made only 0 investments in the past year, with the last investment being in March of last year, participating in the Series A financing of io.net. Pima is a seasoned investor in the crypto space, having entered the digital currency field in 2013 and invested in several well-known blockchain projects. Currently, both co-founders and Continue Capital are in a "lying flat" state, with no activity on their official blog or Twitter. The most recent update about Continue Capital was in October of last year, when co-founder Lin Xiaohong allegedly had $35 million stolen. Lin Xiaohong responded on X platform, saying, "I accidentally exposed that I haven't exited the circle, and passively made a charitable headline."

LD Capital

LD Capital has made only 8 investments in the past year, with the most recent investment being in September of last year, significantly reducing its previous investment frequency. LD Capital also engages in secondary market investments and trading funds, with its funds including Beco Fund, FoF, hedge funds, and Meta Fund. In 2023, LD Capital established Cycle Ventures, an early-stage investment fund focused on Infra, AI, and Dapp.

LD Capital's founder, Yi Lihua, stated that the decline of Web3 investors is attributed to changes in lock-up rules, low investment success rates, and the "triangle dilemma" where investors cannot have "good projects, low valuations, and large amounts" simultaneously. He also pointed out that many investors ultimately only receive a fraction of the amount, which not only may lead to financial losses but also reputational risks.

Bixin Ventures

Bixin Ventures, founded by Chinese crypto OG Xingkong, has made only 5 investments in the past year, with the most recent investment being in January of this year, showing a significant decrease in investment frequency compared to 2024. Bixin Ventures is the investment arm of Bixin Group, which was established in 2014 and is one of the largest cryptocurrency wallet providers in Asia, dedicated to providing users with tools for storing and managing blockchain assets. Bixin Ventures' social media is still operating regularly, and team members are quite active on social media.

Xingkong, the founder of Bixin Ventures, recently expressed his frustrations on social media: "Spending money has turned into a big disaster; this probably describes the fate of VCs in the crypto space." "People have misunderstandings about VCs; VCs are the biggest victims in the crypto space, and VCs' LPs are the most miserable existence. The money earned by exchanges, project parties, and KOLs all comes from VCs."

LK Venture

LK Venture is a venture capital firm founded by Wang Feng, the founder of Mars Finance, investing in blockchain technology and application projects. It was formerly known as Consensus Lab. LK Venture has made only 2 investments in the past year, with the most recent investment being in August of last year. Despite the pause in primary investments, partners Wang Feng and Leo Deng remain active on social media.

Wang Feng, the founder of LK Venture, also established the NFT marketplace Element and the crypto media MarsBit News. Recently, Wang Feng has been closely following new technologies such as AI and robotics on social media. In his latest update, he stated, "Bitcoin, Ethereum, and SOL are the best crypto asset combinations for the company. For Bitcoin, we still need to 'bet' on it; we are also concerned about XRP and SUI. We do not rule out the possibility of fully adopting Bitcoin as the basis for managing the company."

Mint Ventures

Mint Ventures has not made any investments in the primary market in the past year, with the most recent investment being in November 2022. Its business focus has gradually shifted to research and secondary markets, and its social platform and podcast "WEB3 Mint To Be" continue to maintain a high frequency of updates.

Youbi Capital

Youbi Capital has made only 3 investments in the past year, with the most recent investment being in November of last year, showing a decrease in investment frequency since 2022. Youbi Capital's official social platform continues to operate regularly, providing post-investment services. Chen Li is an early Bitcoin miner in China, holding a Ph.D. in chemistry and previously worked as a scientist at Regeneron Pharmaceuticals, where he won awards for developing antibody drugs. In 2015, he was introduced to Bitcoin mining through a college roommate and co-founded Youbi Capital in 2017.

EVG

Everest Ventures Group (EVG) has made only 7 investments in the past year, with the most recent investment being in November of last year, showing a significant decrease in investment frequency compared to 2024. However, EVG is strictly speaking an operating group with a very broad business scope, having a global team of 300 people and has built and launched a diversified product portfolio covering various use cases, such as the crypto asset management platform Aspen Digital, and has launched a series of products involving SocialFi, GameFi, and fintech, such as the DeFi product Mugen Interactive, the cryptocurrency social investment platform Kikitrade, and the brand LiveArt.

Fundamental Labs

Fundamental Labs has made only 1 investment in the past year, with the most recent investment being in July of last year. Its founder, Raymond Yuan, has many years of venture capital experience and a successful investment record in semiconductors, TMT, and artificial intelligence. He transitioned to the crypto industry in 2016, founding CTH Group, which has three core businesses: blockchain infrastructure as a service Atlas, cryptocurrency venture capital Fundamental Labs, and digital asset management IDEG. In 2023, Raymond Yuan also founded the global digital payment company WSPN and launched the US dollar stablecoin WUSD.

DeFiance Capital

DeFiance Capital has made only 1 investment in the past year, with the most recent investment being in May of last year, showing a significant decrease in investment frequency. The latest investment was an angel round financing for the MIT-Harvard team Optimum by the founder himself. Despite the decrease in investment frequency, DeFiance Capital remains quite active on social media and was even recruiting at the beginning of the year. Founder Arthur Cheong, a well-known KOL, continues to provide insights. Recently, he stated that collusion between projects and market makers to manipulate prices, while CEX turns a blind eye, is the main reason why the current market cannot attract investments.

Matrixport Ventures

Matrixport Ventures has made only 2 investments in the past year, with the most recent investment being in December of last year. In 2024, it made 8 investments. Matrixport Ventures is the venture capital arm of Matrixport, Asia's largest crypto financial services platform. The founder of Matrixport is Wu Jihan, and Matrixport's products include Cactus Custody, spot OTC trading, fixed income, structured products, loans, and asset management.

Basics Capital

Basics Capital has made only 4 investments in the past year, with the most recent investment being in December of last year, showing a significant decrease in investment frequency compared to 2024.

7 O'Clock Capital

7 O'Clock Capital has made 0 investments in the past year, with the most recent investment being in April of last year. Its social platform continues to operate regularly, but research and investment activities are basically at a standstill.

Old Fashion Research

Old Fashion Research has made only 1 investment in the past year, with the most recent investment being in September of last year. OFR is a multi-strategy blockchain investment fund, founded in July 2021 by former Binance executives and investment team members. At the beginning of last year, several partners left the firm.

Puzzle Ventures

Puzzle Ventures has made only 3 investments in the past year, with the most recent investment being in December of last year. Its founder, Qi Wang, is also the co-founder and COO of the decentralized trading platform DODO, as well as a co-founder and general partner of the secondary market liquidity fund Metrics Ventures. The official social media of Puzzle Ventures and its founder have not been very active recently.

Redline DAO

Redline DAO has made only 1 investment in the past year, with the most recent investment being in August of last year. At the beginning of 2024, Redline DAO announced its upgrade to Redline Labs, stating that it would shift from investment to comprehensive project incubation. The focus of research will continue to monitor the development of blockchains such as BTC and Solana and the growth of their ecosystems. Its founder and managing partner, Kris Li, is a successful trader who focuses on the secondary market.

In addition to the above crypto-native funds, some comprehensive venture capital firms in Chinese-speaking regions have significantly reduced their investment frequency in the crypto field:

• Zonff Partners has made only 2 investments in the past year, with the most recent investment being in November;
• DHVC has made only 0 investments in the past year, with the most recent investment being in June of last year;
• Sky9 has made only 5 investments in the past year, with the most recent investment being in August of last year; the partner responsible for crypto investments, Niu Fengxuan, left in April of last year;
• Initiate Capital has made only 2 investments in the past year, with the most recent investment being in November.