Binance announced this week that co-founder Yi He will take over as head of its venture capital investing and incubator arm, Binance Labs. The operation has invested in over 200 projects in the blockchain space, and Binance says it manages assets totaling US$7.5 billion, making it one of the largest VC players in the industry.
Yi said her vision is to drive future adoption of blockchain technology in Web3 projects by “building the standard for the blockchain industry.” The current bear market is the best time to invest in new projects, Yi said, and she intends to double Binance Labs’ personnel to 40 people. Fellow Binance co-founder and CEO Changpeng “CZ” Zhao said current conditions present “an unparalleled opportunity to identify those projects with the tenacity to thrive in tough conditions.”
Yi echoed those comments by saying, “Part of the journey of seeing Binance grow, especially through tough market conditions, has been the ability to identify those founders that have the skills and embody the values needed to thrive in an environment where resources are more limited.”
— Yi He (@heyibinance) August 3, 2022
Launched in 2018, Binance Labs focuses on “early-stage projects in key verticals.” Some of these have included Polygon, FTX, Certik, Axie Infinity, Kava, and Dune Analytics. It has also invested in major existing blockchain projects like BTC and Ethereum. Binance Labs said it had earned a 2,100% rate of return on its investments.
Binance Labs also agreed to chip in US$500 million for Elon Musk’s $44 billion Twitter takeover bid. However, that deal is currently the subject of two legal disputes after Musk attempted to withdraw. The Delaware Chancery Court will try Twitter’s case in October 2022, and Musk has also countersued the company over the affair.
The team also recently closed a US$500 million investment fund deal that included Breyer Capital and DST Investment partners.
Binance’s power over markets makes good investments
Investments from Binance Labs are highly sought-after in the blockchain industry since a portfolio project stands a good chance of getting its digital assets listed on Binance’s exchange. Given that exchange listings can make or break a new blockchain project, and Binance is one of the world’s most-used exchanges, it’s a big step along the road to success.
A tracker list of assets from Binance Labs’ portfolio is available here.
Binance notoriously flexed its market influence muscles in 2019 when it led the “Delist BSV” campaign. That effort, joined by exchanges such as Kraken and Shapeshift, sought to manipulate the digital asset market by removing BSV trading from their platforms. BSV was one of the world’s top five digital assets by market cap at the time.
A group of BSV investors recently joined in filing a collective proceedings lawsuit in the U.K. (similar to a class action in the U.S.) against Binance, Kraken, ShapeShift, and Bittylicious) over the campaign. Claiming the exchanges engaged in anti-competitive behavior by delisting BSV for no good reason (other than to damage its market value), the group also seeks redress for the money they lost as a result. They also noted that the exchanges’ actions have “gone unchallenged by regulators.”
Although the campaign was unsuccessful in its attempt to make BSV disappear, it was enough to drop BSV from investors’ radar during the 2020-21’s blockchain bull run. Whether BSV is better off remaining slightly outside blockchain’s speculative hype patterns is a matter for debate. However, exchanges such as LATOKEN and Huobi have recently begun new BSV listings. Huobi Japan became the first exchange to list BSV in that country in June 2022.
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