Bahrain`s Investcorp launches a blockchain investment fund

TL;DR Breakdown

• Bahrain’s largest asset manager, Investcorp, launches a blockchain fund.
• The blockchain fund based in GCC has a global investment mandate. 

Bahrain’s Investcorp Holdings, the country’s largest asset manager, launched a global institutional blockchain fund. The organization is seeking to invest in firms using blockchain technology. The firm, which Forbes rated as the second-largest wealth manager in the Middle East, is now seeking investors to finance the new fund.

Bahrain’s asset manager to fund blockchain start-ups

The Middle East is rapidly becoming a cryptocurrency and blockchain hotspot. Friendly laws are being offered in Bahrain, Dubai, and Abu Dhabi to attract bitcoin investors. The investment fund is good news for crypto developers and investors.

Investcorp has a good track record in tech-related investments. However, this is the first time Investcorp is expanding into the blockchain industry.

Hazem Ben-Gacem, Co-CEO at Investcorp, stated, “We have a strong track record in technology investment and will bring our institutional expertise and global reach to bear on this fast-growing area of technology.”

Investcorp is a Bahraini investment firm operating for more than four decades. It expanded to become one of the region’s most important alternative asset management firms. It built a global presence by investing across various asset classes and regions. During the coronavirus pandemic, the firm made several acquisitions in order to take advantage of depressed asset valuations.

Investcorp Holdings is also called the tech fund eLydian Lion. The eLydian Lion fund will base operations in Abu Dhabi. According to a statement, it plans to invest in firms that operate blockchain infrastructure, platforms, exchanges, decentralized finance, and data analytics. The company didn’t provide a figure for how much money it intended to raise for the fund.

According to Investcorp’s Chief Technology Private Equity Gilbert Kamieniecky, blockchain and related technologies can revolutionize the economy the same way as the internet did. Kamieniecky said that Investcorp would use this money to assist innovative global minds in building out the blockchain ecosystem.

According to reports, the fund will allow investors to get early exposure to the growing blockchain ecosystem. Investcorp is based in Bahrain, New York, Doha, Abu Dhabi, Riyadh, Mumbai, Singapore, and London and is backed by Mubadala Investment Co. of Abu Dhabi. It is also raising money for several other funds at this time both operational in Bahrain and globally. It currently manages about $40 billion in assets and has recently begun to expand in Asia as part of its strategy to more than double the size.

Last year, Investcorp delisted from the Bahrain stock exchange after nearly four decades, with the firm claiming it would give it more flexibility to grow. Mubadala acquired a 20% stake in Investcorp in 2017, which previously backed companies like Tiffany & Co. and Gucci Ltd.

Investcorp takes advantage of crypto adoption in the Middle East 

The Middle East is becoming increasingly interested in cryptocurrency, with new fundraising efforts being a hot topic. In March, Dubai established a new agency charged with digital asset regulation — a framework that cryptocurrency exchange giant Binance helped establish.

Over the weekend, Binance received preliminary approval from Abu Dhabi Global Market (ADGM) to trade as a broker-dealer in digital assets. The new fund is a self-governing entity that does not affiliate with Investcorp Technology Partners, a European technology sector-focused division of Investcorp that oversees the firm’s investment approach in lower mid-market technology projects.

According to Bloomberg, Investcorp is seeking to raise additional capital for other ventures. The firm that manages assets worth more than $40 billion intends to double its size in coming years through these investments. Additionally, Investcorp is also looking to expand its presence in Asia.

Investcorp completed the purchase of MIR Limited, which provides payment and e-wallet services, at the end of 2017. According to BusinessLine, a company executive said that the firm had invested more than $600 million in Indian start-ups and other industries worldwide. It anticipates that AUM (assets under management) will exceed $1 billion in valuation in the coming years.

Investcorp is raising additional cash to invest in Indian early-stage firms. The firm expects to seek another $500 million in funding. The organization claimed that Blockchain technology and the ecosystem surrounding it have the potential to revolutionize every area of our economy, much like the internet did in the last two decades.

Gilbert Kamieniecky, head of Investcorp’s technology private, mentioned that “We have already seen the potential of blockchain to disrupt existing markets and create new ones, such as the meteoric rise of the non-fungible token’s market that in just a few years has grown from under a billion to more than $40bn.”