Veterans of Two Sigma Investment Firm Raising $25 Million Crypto Venture Fund

A new player has entered the world of crypto investments! Metalayer, a new firm, just filed paperwork with the Securities and Exchange Commission outlining its plans for a $25 million investment fund. And guess what? The brains behind this operation are three veterans from Two Sigma Ventures, a well-known VC arm of the secretive New York investment firm Two Sigma.

According to insiders, Metalayer has already secured $20 million in committed capital during its first close last Friday. Their goal is to raise the full $25 million by the end of the year. Initial funding for Metalayer came from senior executives at Two Sigma Ventures, but the two firms won’t have a formal relationship moving forward. Two Sigma itself is recognized for managing a hefty $60 billion in assets through its hedge fund.

Metalayer isn’t just relying on Two Sigma for backing; they’re also raising capital from family offices and other big shots in the crypto world. One of Metalayer’s founders, Andy Kangpan, used to lead the digital asset team at Two Sigma Ventures until August 2024. Mickey Graham and David Winton, also co-founders, have their own impressive backgrounds in the finance and tech fields.

Now, let’s talk about Data-first. Two Sigma has built a reputation for being a top-tier quant firm in the hedge fund world, giving a new spin to the concept of data and software-first trading. Recently, they’ve been making moves in the crypto space, dabbling in trading, market-making, and of course, venture investing.

Speaking of venture investing, Metalayer is wasting no time. They’ve already invested in three companies, including Ethena, Crossover, and Clear Token. These projects focus on areas like yield-bearing assets, crypto exchanges, and blockchain clearinghouses to bridge the gap between crypto and traditional financial services.

While popular cryptocurrencies like Bitcoin and Solana have been on a wild ride lately, overall crypto venture activity has taken a bit of a hit. But fear not! Venture firms are still actively fundraising, with some big players closing multimillion-dollar funds left and right.

As Metalayer rises, its founders’ former employer, Two Sigma, is going through some changes. The firm recently cut 200 staff members and saw its billionaire founders take a step back amid legal troubles. It’s a bumpy road, but Metalayer is ready to shake things up in the crypto market!

And hey, if you want to learn more about crypto, check out Fortune’s Crypto Crash Course for quick and easy lessons. It’s never too late to jump into the exciting world of digital assets!