Theta Capital seeks $200 million for blockchain fund-of-funds targeting early-stage opportunities
Karla Barker 
New Blockchain Investment Vehicle
Theta Capital Management is moving forward with plans to raise $200 million for its latest blockchain funds-of-funds initiative. The Amsterdam-based investment firm, which shifted its focus to digital assets back in 2018, believes this timing allows them to capitalize on early-stage blockchain opportunities even as venture funding in the sector remains somewhat subdued.
The new vehicle, called Theta Blockchain Ventures V, will distribute capital across 10 to 15 venture firms that specialize specifically in digital assets. The company is targeting a net internal rate of return of 25% from this investment, which seems ambitious but perhaps achievable given their track record.
Proven Track Record
Theta Capital isn’t new to this space. They’ve previously managed five funds in the Theta Blockchain Venture series, and their performance has been quite strong – delivering a 32.7% net IRR from January 2018 through December 2024. That’s not something to ignore, especially in such a volatile market.
Their portfolio includes some of the bigger names in crypto venture capital: Pantera Capital, CoinFund, Polychain Capital, and Dragonfly among others. It’s interesting that they just closed a $175 million funding round back in May for similar initiatives, so this new $200 million target shows they’re doubling down on their strategy.
Specialization Strategy
Ruud Smets, the company’s managing partner and chief investment officer, makes a compelling case for their approach. He argues that venture capital remains the best way to capture long-term upside in the crypto sector, particularly in early funding rounds. Their strategy focuses on specialist managers who can outperform generalist investors when it comes to blockchain opportunities.
“We’ve always been looking for areas where specialization and active management provide a sustainable edge,” Smets noted. He believes that the experience and positioning of dedicated crypto VCs have compounded over time, creating barriers for less focused investors trying to enter the space.
Challenging Market Conditions
Despite Theta’s confidence, the broader crypto venture investing landscape has been challenging this year. Data from Galaxy Digital shows only $1.7 billion was allocated to 21 crypto-focused venture funds in the second quarter of 2025. That’s well below levels seen during previous bull markets, which makes Theta’s timing either very brave or very strategic.
There’s some conflicting data though – VC investment actually saw a 54% year-over-year increase to $4.8 billion in Q1 2025 according to Galaxy. PitchBook reported $6 billion in VC funding for the same period, despite a 39.5% decline in funding volume from the previous year.
What’s interesting is where the money is flowing. Capital seems to be increasingly directed toward trading, asset management, and crypto financial services, with $2.55 billion allocated to 16 deals in Q1 2025. Infrastructure and development firms raised around $955 million across 30 deals.
Robert Le, PitchBook’s senior crypto analyst, noted that capital continues to seek crypto’s core utility rails despite macroeconomic uncertainty. But there’s also competition from artificial intelligence investments, which have been drawing some attention away from crypto.
Upcoming Conference
Theta is also organizing its premier blockchain conference for institutional allocators on October 16th in Amsterdam. The Legends4Legends charity conference will focus on “Blockchain Goes Mainstream: Stablecoins & Beyond” and aims to help allocators navigate the blockchain industry while raising funds for the Alternatives4Children charity.
The conference will explore key developments including blockchain-native financial infrastructure and the convergence of AI and crypto. Qualified institutions can attend for free, which suggests Theta is serious about building relationships in the institutional space.
If successful with this latest funding round, this would mark Theta’s sixth fund in the series. Given their track record and the current market conditions, it will be interesting to see how quickly they can raise the $200 million and which venture firms they ultimately select for their portfolio.