Billionaire investor and hedge fund manager Steve Cohen’s Point72 Ventures has made its first move into the cryptocurrency sector, backing blockchain-based data marketplace Spacemesh.
The firm, created by Cohen as a technology-oriented venture arm of his family office, has contributed to a seed funding round of $2.4 million for the new digital services startup. According to a statement released on Thursday, other investors include Lakestar, Distributed Global and ex-Adobe CTO James Gowans.
The investment marks Point72’s first foray into the quickly expanding crypto business since Cohen acquired investment firm Autonomous in 2018. The firm had previously tested out cryptocurrency trading through Autonomous but hasn’t revealed any major investments in the arena until now.
The move could signal another step towards mainstream cryptocurrency adoption amongst major investors and institutions. However, despite Cohen’s success with traditional investments, many had questioned his presence in a space that still carries an element of risk due to market volatility and regulatory uncertainty.
Background on Point72 Ventures
Point72 Ventures is the venture capital arm of Point72 Asset Management, a $14 billion hedge fund founded by Steve Cohen.
Point72 Ventures focuses on investments in early-stage companies and technologies across various sectors, including financial technology, healthcare, enterprise software, and consumer products. Their recent foray into crypto signals their intent to diversify into the rapidly evolving cryptocurrency industry.
Overview of Point72 Ventures
Point72 Ventures is a venture capital firm investing in early- to late-stage technology, healthcare and consumer businesses. In addition, the firm invests in emerging technologies and disruptive business models ranging from seed-stage to Series C and beyond. Point72 Ventures is backed by Steve Cohen, founder of Point72 Asset Management.
The venture arm of Point72 was founded to uncover companies that are driving financial services and the broader economy forward through their innovative use of technology and data analytics. The group boasts several global executives with experience from various fields, including venture capital, technology, banking, operations and business management.
Point72 Ventures focuses on identifying cutting edge startups that will help transform how companies in the financial services industry work together in today’s digital age. Generally speaking, the venture firm invests across various industries including FinTech/Finance Services, Enterprise Software & SaaS, Manufacturing & Logistics Technology Solutions, Consumer & Business Services Technology Solutions, and Healthcare related investments. Recently they made their first crypto bet with an investment into Aave’s series A funding round.
Steve Cohen’s Involvement
Steve Cohen founded Point72 Ventures, a venture capital firm that invests in early-stage startup companies. Founded in 2017, Point72 Ventures has invested over $1 billion in 133 companies.
In May 2019, Point72 Ventures made its first venture capital investment into the cryptocurrency industry by investing an undisclosed amount in Tagomi Systems, a cryptocurrency trading platform. Steve Cohen commented on his investment: “It’s an exciting opportunity to invest behind an established team with a differentiated approach to bringing institutional-quality services and best practices to the fast-growing crypto markets”.
With this move, Cohen signaled his intent to become involved in the crypto industry and has since invested in several crypto startups such as Forte and Bakkt. With his involvement in this sector he could help expand the digital asset class and validate it as a viable form of investing.
His firm’s investments total more than $46 million into digital asset companies with the majority directed towards institutional-grade service providers and tools that enable enterprise to adopt digital assets while mitigating risk.
Steve Cohen’s Point72 Ventures Makes First Crypto Bet
Steve Cohen’s Point72 Ventures recently made its first foray into crypto, investing in a technology firm called Axoni. This marks the first crypto bet from the venture capital arm of Cohen’s hedge fund giant Point72.
Point72 Ventures will be looking to capitalize on the booming crypto industry, using its investments to boost the development side of crypto projects.
We’ll explore more of the details behind this venture in the following sections.
Details of the Investment
Point72 Ventures, the venture arm of Point72 Asset Management, recently made its first bet on cryptocurrency by investing in two digital currency projects.
The two projects include a startup called Tagomi, which is building a professional-grade digital currency trading platform for institutional investors; and Compound, an open financial system which will enable lending and borrowing of digital assets like Ether.
Point72 Ventures has stated that it is making a long-term commitment to cryptocurrency investments and is actively exploring opportunities in early stage companies in the space. The company also sees potential to develop products and solutions as the industry matures. In addition, Point72 Ventures has also indicated that it plans to invest in projects related to security tokens (tokens created on top of blockchain networks representing real-world assets), custodial solutions, payments processing and enterprise software infrastructure services.
An interesting move from Point72 Venture is the additional focus on blockchain technology companies instead of just pure investment into cryptocurrencies alone. It appears that Point72 Ventures sees potential in blockchain technology—the underlying infrastructure for cryptocurrencies – as an area where strategic long-term investments can pay off down the road.
Reason for the Investment
Point72 Ventures, the venture arm of Steve Cohen’s Point72 Asset Management, has made its first foray into the cryptocurrency world. On October 22, the firm announced a strategic investment in Autonomous Partners, a cryptocurrency-focused hedge fund founded by Arianna Simpson.
The decision to invest in Autonomous Partners is based on the rapid growth of digital finance and the promise of tomorrow’s global financial infrastructure. Simpson believes that this new digital infrastructure will bring opportunities to individuals around the world and as an investor, Point72 Ventures wants to be at the forefront of this transformation. As such, they are looking to capitalize on those yet undiscovered opportunities today by taking a forward-thinking approach.
Simpson is one of several notable investors looking towards cryptocurrencies with optimism and is widely considered one of the most knowledgeable professionals in digital asset markets. Her expertise has helped her become one of Silicon Valley’s most sought-after advisors for fintech companies and traditional financial institutions who are exploring blockchain technology. Point 72 Venture’s investment in Autonomous Partner signals their belief that cryptocurrency will greatly impact global financial markets in the near future.
Future of Point72 Ventures in Crypto
Steve Cohen, the founder of Point72 Ventures, made a high profile move into the crypto industry with a $15 million investment in autoblock. This move has many speculating what the future of Point72 Ventures looks like in the crypto space.
Let’s dive deeper into the potential futures of Point72 Ventures in the crypto industry.
Potential Future Investments
Point72 Ventures has taken a positive approach to the emerging crypto industry, investing its first venture into legal services firm Corl Financial Technologies in October 2018. However, this is reportedly only the start of what could be bigger plans for Point72 Ventures in the world of cryptocurrencies.
The recent influx of institutional money and larger venture capital firms into crypto suggests increasing demand for digital asset investments. Moreover, Point72 Ventures’ track record indicates that they can identify startups with long-term potential which will strengthen their portfolio in this space. Thus, it appears very likely that further investments by Point72 Ventures in crypto and blockchain companies should be expected soon.
Startups that could be prime candidates for consideration by Point72 Ventures could include Crypto Custodian Solutions, Security Token Exchanges (STO), Decentralized Autonomous Organizations (DAOs) and company representation through the Digital Chambers of Commerce (DCoC). With such potential investments, Point72 Ventures would not just be able to bolster their current stable but gain further exposure to novel technologies outside their traditional sector-specific approach. As this space continues to gain traction and attract more investors beyond just VCs and generate more job opportunities for skilled professionals, it will be interesting to see what activities take place and how far Point72 Ventures will go with its crypto journey over time.
Point72 Ventures’ Goals in Crypto
Point72 Ventures, the venture capital arm of Steve Cohen’s family office, recently made its first crypto investment — a bet on digital asset trading platform Tagomi. Point72 announced that it had “strategically invested” in the platform and appears to be making strategic investments in several different crypto companies. Given Point72 Ventures’ focus on emerging technologies and its access to an impressive network of industry contacts, it appears that crypto is an area of interest.
Point72 Ventures’ goals within the crypto arena are currently unclear – whether investing primarily in specific blockchain projects or taking a more speculative approach by investing in cryptocurrencies themselves. However, regardless of the direction they ultimately pursue, the addition of Cohen’s backing will likely be overwhelmingly positive for the development of blockchain technology and its adoption into mainstream use cases. In addition, Cohen’s past success with venture investments could provide a wealth of knowledge to cryptocurrency startups and access to resources that could otherwise not be obtained through traditional means.
Point72 Ventures has already demonstrated its commitment to blockchains and cryptocurrencies through investments like Tagomi; it will be interesting to see what other companies they choose to invest in and how their involvement will affect growth within the industry.
Conclusion
Based on the information presented, it is clear that Point72 Ventures has taken a big step towards investing in the cryptocurrency market. This move represents a major endorsement for the digital asset class and could set off a swathe of institutional investors diving into its potential.
With influential figures like Steve Cohen now recognizing the benefits of cryptocurrencies and investing their capital, we will likely see greater institutional involvement in this asset over the coming years. Point72 Ventures is becoming a leader in this space, and it will be interesting to see if more of its crypto investments make headlines as we move into 2021.
