Former Binance executive aims to raise $100M to start crypto adoption focused VC

Bill Qian, the former head of venture capital investments and acquisitions at Binance Holdings Ltd., says he aims to raise over $100 million through a new crypto venture capital fund.

Qian told Bloomberg he sees a need for significant user growth as one of the crypto industry’s most critical challenges, a key factor in founding Cypher Capital.

As the chairman of Dubai-based Cypher Capital since leaving Binance in June, Qian told Bloomberg that he plans to back startups focused on web3 and the decentralized internet powered by blockchain technology.

Qian believes that the crypto industry is facing a significant obstacle in terms of limited user growth, which he attributes to the predominant use of cryptocurrency for trading or gambling. To address this issue, Cypher Capital is focusing its investments on projects that can attract more of the approximately 5 billion internet and social media users to the web3 ecosystem, an investment thesis he believes can add to the macro adoption of cryptocurrencies world wide.

Qian did not disclose to Bloomberg whether the fund has secured any commitments from other outside investors, but noted that this year’s resurgence in digital assets, with Bitcoin surging by approximately 50%, has made fundraising less challenging.

“The macro backdrop for us is way better now than my expectations half a year ago,” he said in the interview. Nonetheless, “money is not cheap anymore.”

With a team of 10 employees, Cypher Capital has hired Elaine Liu, a former executive at Tencent, to bolster its expansion efforts in the UAE. In November, the firm established an office in Dubai Marina dedicated to crypto and blockchain startups as part of its strategy to identify potential investment opportunities.

Dubai, as well as the United Arab Emirates (UAE) more broadly, is emerging as a hub for the cryptocurrency industry as jurisdictions such as the US tighten regulations in the wake of last year’s scandals, including the collapse of FTX and the legal action against founder Sam Bankman-Fried.

Leading figures in the crypto space, including Binance CEO Changpeng Zhao and Polygon co-founder Sandeep Nailwal, have relocated to Dubai, which recently issued a finalized set of rules for regulating the cryptocurrency sector.