Huobi Global, a digital asset exchange, has created a new investment arm that focuses on decentralized finance (DeFi), and Web3 projects. This highlights venture capital interest in the Blockchain economy.
The new investment arm, called Ivy Blocks has more than $1 billion worth of crypto assets that it can deploy. A spokesperson for Huobi confirmed this. The funds will be used to “invest in promising blockchain projects” according to Huobi.
Ivy Blocks will provide financing in addition to other services. These include an asset management platform and a new incubator for blockchain technology. According to Lily Zhang (Huobi Global’s chief financial officers), the firm’s asset manager will offer “liquidity investments” in order to help DeFi or Web3 projects get started.
Ivy Blocks announced Friday that Capricorn Finance was the first project to be funded. This automated market maker, built on the Cube Blockchain, was also announced by Ivy Blocks.
The sector’s overall value is now down more than half since its peak. This firm’s focus to DeFi coincides with a period when it’s overall value has fallen by more that half. According to industry data, the sector’s total value locked (TVL) is just below $133 billion. In December 2021, DeFi TVL topped $316 billion.
DeFi’s woes may be a sign of the crypto winter that has gripped the market since 2022. Analysts believe market-cleansing Bear Cycles are healthy, as they often follow “irrational”, periods when asset prices are priced up recklessly.
Related: VC crypto investments see a decline of 38% after record growth in May
Venture capital continues to flood the crypto market despite the downtrend. Investors are prioritizing Web3 and metaverse games. According to Cointelegraph Research, crypto and blockchain projects received $14.6 million in capital investments during the first quarter. Venture capital investment totaled $30.5 billion in 2021.