Venture Capital firm Dragonfly gearing up to collect a staggering $500 million for its fourth investment fund in the realm of cryptocurrency.
In the ever-evolving world of digital currency and blockchain technology, Dragonfly Ventures, a renowned crypto-focused venture firm, is making waves with its fourth fund, currently valued at approximately $650 million. This fund is primarily focused on the broader digital currency ecosystem, with an emphasis on privacy-focused technologies and open-source projects.
The launch of the fourth fund comes at a time when multiple Web3-focused venture capital firms are returning to the market following two years of crypto winter. According to CrunchBase's Web3 tracker, Q1 and Q2 2024 saw a significant increase in funding for Web3 startups, with $1.9 billion raised in Q1, a marked jump from the $1.2 billion raised in Q4 2023.
Dragonfly's strategic positioning in the digital currency investment space was further solidified with the acquisition of MetaStable Capital, a move that signified a rebranding and expansion. This expansion has allowed Dragonfly to continue its commitment to blockchain innovation and privacy technology.
Despite recent scrutiny from the U.S. Department of Justice (DOJ) due to its early investment in the privacy tool Tornado Cash, Dragonfly has managed to clear the air. In mid-2025, the DOJ clarified that it will not pursue charges against Dragonfly or its executives, acknowledging that the 2020 investment had been preceded by legal compliance checks. This outcome has been significant for Dragonfly’s reputation and ongoing investment activity.
While the exact recent portfolio details for the fourth fund are not publicly detailed beyond the Tornado Cash-related investment, the emphasis remains on the firm’s continued commitment to blockchain innovation and privacy technology. In March, Dragonfly led an $11 million pre-Series A round for Web3 AI platform MyShell, and in the same month, it led a $20 million seed round for consumer-focused blockchain Morph.
Furthermore, Dragonfly's plans include investing in early-stage crypto projects, aligning with the active seeking of early-stage crypto opportunities by Web3-focused venture capital firms. In June, Dragonfly invested in MegaETH, a real-time EVM-compatible blockchain being developed by MegaLabs.
Dragonfly's third fund, closed at $650 million in 2022, boasted backing from Tiger Global, KKR, Sequoia China, Ivy League endowments, and Invesco. The new fund has already garnered $250 million, indicating a promising start.
In conclusion, Dragonfly Ventures' fourth fund continues to support its ongoing strategy to invest in privacy-focused and open-source blockchain projects, despite facing scrutiny in the past. The firm's commitment to blockchain innovation and its strategic positioning in the digital currency investment space make it a player to watch in the rapidly evolving world of Web3.
News of Dragonfly Ventures' fourth fund, currently valued at approximately $650 million, signals a return of Web3-focused venture capital firms to the market following two years of crypto winter. This fund, primarily invested in the broader digital currency ecosystem, especially privacy-focused technologies and open-source projects, has already initiated investments in Web3 AI platform MyShell and consumer-focused blockchain Morph, further demonstrating its commitment to investing in Web3 finance and technology.
