If there is any target other than Bitcoin that will be surprising in 2023, Solana must have a place. Slowly recovering from the FTX thunderstorm incident, Solanas market value ranking has returned to the top five. In addition to SOL holders, there is also Multicoin Capital who is happy about this.
As an early investor in Solana, Multicoin Capital has achieved high returns during the 2021 bull market, and its investment style driven by thesis investment research is also very popular. However, as a series of events caused Multicoins asset management scale to shrink rapidly, the number of investments in 2023 was only a quarter of the previous two years. However, the encryption market picked up at the end of last year. Not only Solana, but also many asset targets in Multicoin Capitals portfolio have experienced considerable gains, from Helium Mobile (MOBILE) on the DePin track to the new public chain Sei (SEI).
This deserves our attention. Is the once popular Multicoin investment concept coming again?
Multicoin Capital Portfolio Opening List
In December last year, the token MOBILE of the decentralized wireless communication network Helium Mobile increased nearly tenfold in a week, driving the popularity of the entire DePin sector to reappear.
Helium and Multicoin Capital have a long history of cooperation. In June 2019, Helium completed a $15 million Series C round of financing, led by Multicoin Capital and Union Square Ventures. In August 2021, Helium announced that it had completed US$111 million in financing through token sales, with a16z leading the investment and Multicoin Capital, Alameda Research and others participating.
Heliums native token HNT rose from a price of less than $0.2 in the middle of the year to a maximum of $52 in 2021, becoming one of Multicoin Capitals best investment return targets that year. In July 2022, the Helium Foundation launched a new token MOBILE as a reward for 5G hotspots to expand Helium 5G coverage. Multicoin Capital co-founder Tushar Jain also posted a long tweet explaining how MOBILE is different from HNT. As of the time of writing, the price of MOBILE is $0.0035, with a 24-hour increase of 27.9%.
When it comes to the DePin sector, we have to mention Hivemapper, another DePin project invested by Multicoin Capital. Hivemapper is a decentralized, continuously updated map built by people using their dash cams. This new map economy represents a fundamental shift in the way people own maps and share economic benefits with those who create global maps.
In April 2022, Hivemapper announced the completion of US$18 million in financing, led by Multicoin Capital, with participation from Solana founder, former Apple Maps executive and Helium CEO. On January 4, Coinbase added Hivemapper token HONEY to its currency listing roadmap. Subsequently, the HONEY price rose to $0.26 in a short period of time, with a 24-hour increase of 85.2%.
Since December last year, another dazzling investment target of Multicoin Capital is Sei (SEI). After the price of mainstream tokens plummeted on the evening of January 3, SEI briefly exceeded $0.82, and as of writing, the price was $0.77.
As a new generation of Layer 1 public chain, Sei has attracted much attention due to its strong financing background since its mainnet was launched in August this year. Among them is Multicoin, which started from public chain investment. In August 2022, Sei Labs completed a US$5 million seed round of financing, led by Multicoin Capital, with participation from Coinbase Ventures, GSR, etc.; in April 2023, Sei announced the completion of US$30 million in financing at a valuation of US$800 million, led by Multicoin Capital, Jump Capital and others participated in the investment.
Sei announced at the end of November last year that it would use parallel EVM technology to upgrade v2 this year, and the parallel EVM narrative is considered a key focus in 2024 by many investment research institutions. If Sei can continue to maintain its current price trend, it will be another investment target with a high yield for Multicoin.
Related Reading:Nearly four times in two weeks, is Sei the next Solana?》
Another Multicoin investment target that has seen price gains recently is the Perpetual Protocol, a perpetual contract protocol. On January 3, as of the time of writing, the price of Perpetual’s native token PERP had risen to a maximum of $2.1, a 24-hour increase of more than 60%.
In August 2020, Perpetual Protocol completed US$1.8 million in financing, led by Multicoin Capital. Multicoin Capital co-founder Kyle Samani once wrote an article introducing Perpetual, saying that it combines the advantages of CeFi and DeFi, with the CeFi-style leverage that perpetual contract traders expect, as well as the liquidity and simplicity provided by the DeFi system AMM.
《Multicoin: A brief introduction to the DeFi perpetual contract protocol Perpetual Protocol》
After a brief inventory of the investment targets with recent price increases in the Multicoin Portfolio, we must also mention Solana, the investment target that once brought Multicoin Capital to the top.
The history of success and failure of Multicoin Capital
Axios on December 30, 2021reportSince Multicoin was established in October 2017, its hedge fund assets have soared 20,287%. Its first venture capital fund has returned more than 28 times to investors after deducting fees. Among them, the projects with the highest investment returns include Solana, Helium and Arweave.
In May 2018, the little-known Solana Labs sold 79.25 million tokens at a price of $0.04, and Multicoin Capital was one of the buyers. In 2019, the Solana team launched five rounds of financing, four of which were private placements. These private placements began in the first quarter of 2019 and ended in July 2019, when MultiCoin Capital led a $20 million Series A investment in Solana Labs. In June 2021, Multicoin Capital participated in Solana’s US$314 million financing.
Solanas price was close to $260 at the peak of the bull market in 2021, and its market value jumped to third place in September 2021. As of the end of 2021, the price of Solana has increased by approximately 21,609% since the Solana token began trading in April 2020, with HNT rising from a price of less than $0.2 in the middle of the year to as high as $52. And this is just the profit multiple of the secondary market. Multicoin’s actual profit as an institution is even more exaggerated.
Solana TVL trend chart; Source: DeFiLlama
Therefore, Multicoin Capital’s three rounds of investment in Solana made its returns unparalleled among crypto VCs that year.
In 2021, Multicoin Capital raised $100 million for its second venture capital fund in May, and also raised $250 million for its third venture capital fund. In September of the same year, Kyle Samani was a guest on the FTX Podcast and stated that Multicoin Capital’s current asset management scale had reached US$4 billion. As the token prices of its portfolio are still rising, this has even influenced traditional venture capital companies such as a16z and Sequoia Capital to change their investment structures to hold more digital assets.
Different from the investment styles of technology flow and capital flow such as Alameda and 3AC, Multicoin has insisted on thematic investment since its inception. The two founders, Kyle Samani and Tushar Jain, always write articles to explain the investment logic behind each transaction. ”, they dare to take out projects that “deviate from the mainstream”, dare to buy in the divergence, and take heavy positions against the trend. This investment style also gives the fund’s subsequent success a certain “romantic” color – this style is Solanas performance was at its peak.
But success comes with failure. The FTX thunderstorm in 2022 made Solana one of the most affected crypto projects, and its currency price once fell to single digits. Due to the FTX bankruptcy, Multicoins asset size fell by 55% in about two weeks. In addition to 9.7% of assets under FTX custody, the loss was also due to its long-term bullishness on Solana and Solana ecological assets, such as Mango, holdings of FTX.US equity and outstanding derivatives contracts.
At the end of December 2022, Soldman Gachs, who had disclosed a lot of information as a creditor of Three Arrows Capital, said on Twitter that it had just received its November investor statement from Multicoin Capital. The statement stated that In the past 11 months, In the month, the fund fell as much as 90%.”
In March 2023, Multicoin Capital stated in the companys annual investor letter that the Multicoin Capital hedge fund lost 91.4% in 2022, its worst performance since its inception. Recently, Kyle Samani and Tushar Jain once again wrote to LP stating that currently about 10% of the Multicoin fund’s asset management scale is still waiting to be withdrawn on FTX.
Related Reading:Multicoin retraces 90%: it’s just the same source of profits and losses》
In this way, Multicoin Capital began its journey of silence. According to RootData data, Multicoin Capital only made 10 investments in 2023, ranking low in the number of investments among mainstream crypto VCs. The number of Multicoin Capital investments in 2021 is 41, and the number of investments in 2022 is 40.
Comparison chart of mainstream crypto VC investment numbers in 2023; Source: Rotodata
However, with the rebound in SOL prices, the revitalization of the Solana ecosystem, and the rise of new public chains such as Sei, Multicoin Capitals investment portfolio has ushered in a new round of growth. According to CrunchBase data, Multicoin Capital has currently raised a total of $605 million. We don’t know whether the crypto market will see a return on investment like Solana did for Multicoin in 2024, but we can learn in advance about the projects in the Multicoin Portfolio that have not yet made a major breakthrough in token prices, so as to better grasp them. A dark horse in a bull market.
What other Multicoin investment projects should you keep an eye on?
In an interview with Blockcrunch, Kyle Samani, the co-founder of Multicoin Capital, answered the question of what he would do before investing in a new project. He mentioned that we will spend more time analyzing the market structure, understanding how the market works and what levers the team can use. Go forward. This is the key reason to ensure that Multicoin Capital can pick the dark horse among the new projects. Therefore, BlockBeats has taken stock of several potential projects worthy of attention in its investment portfolio. For more projects, readers can go to the official interface of Multicoin Capital to inquire.
Related Reading:Multicoin Lianchuang Kyle: How does Multicoin make investments?》
Jito Labs（JTO）
On August 11, 2022, Solana ecological liquidity staking protocol Jito Labs completed a US$10 million Series A financing, led by Multicoin Capital and Framework Ventures, Alameda Research, Solana Ventures, Delphi Digital, Robot Ventures, Solana Labs co-founder Anatoly Yakovenko , Coral founder and former Alameda Research engineer Armani Ferrante, and Solana Foundation communications director Austin Federa also participated in the investment.
Jito Labs aims to increase the speed and finality of Solana transactions and provide rewards to validators and stakers. In November 2023, Jito launched the governance token JTO and conducted a retroactive airdrop.
According to CoinGecko data, as of the time of writing, the price of JTO is US$1.5, the market value is US$181 million, and FDV is US$1.57 billion, ranking 246th.
Worldcoin（WLD）
The popularity of Worldcoin needs no introduction. It aims to provide digital identity proof for humans in the era of artificial intelligence. In October 2021, Worldcoin development company Tools for Humanity completed a $25 million Series A financing, with participation from institutions such as Multicoin Capital and Three Arrows Capital. In May 2023, Worldcoin completed a US$115 million Series C financing, led by Blockchain Capital, with participation from a16z, Bain Capital Crypto and Distributed Global.
In December last year, Worldcoin announced the launch of World ID 2.0 digital passport and high-performance development platform. According to CoinGecko data, as of the time of writing, WLD price is US$3.22, market value is US$338 million, and FDV is US$31 billion, ranking 164th.
Pyth Network（PYTH）
On December 5, 2023, the oracle project Pyth Network completed a new round of financing, with Multicoin Capital, Wintermute Ventures and others participating in the investment. In November of the same year, Pyth Network launched a retroactive airdrop, and its native token PYTH also participated in BackPacks staking activities.
According to CoinGecko data, as of the time of writing, the price of PYTH is US$0.28, the market value is US$418 million, and the FDV is US$2.78 billion, ranking 140th.
Marginfi
Another noteworthy Solana ecological project invested by Multicoin Capital is Marginfi. In February 2022, Marginfi, a DeFi margin protocol based on Solana, announced the completion of US$3 million in financing. This round of financing was led by Multicoin Capital and Pantera Capital, with Sino Global Capital, Solana Ventures and others participated in the investment.
Currently, Marginfi has not launched its token plan, but there is an official points activity that is generally considered to be the basis for future retroactive airdrops. Readers can learn about it on their own.
