Crypto VC Dao5 Closes $222M Fund to Back Institutional-Focused Projects

Despite ongoing challenges in the crypto venture landscape, Web3 investment firm Dao5 has successfully closed a $222 million fund focused on driving institutional adoption of blockchain technologies. The announcement marks a notable achievement given the current difficulties many traditional firms face in raising capital.

Founded in 2022, Dao5 emerged in a turbulent year for crypto. Its first fund closed just before the collapse of FTX—a crisis that sent shockwaves through the industry. Still, Dao5 managed to back standout projects like Berachain and Bittensor, and according to founder and managing partner Tekin Salimi, investors from that initial fund have already recovered their contributions.

That early success, he believes, paved the way for the latest raise.

“I credit that to a big part of why we’re able to have a successful fundraise in this market,” Salimi told Fortune.

The new $222 million fund is backed by just 15 limited partners, primarily composed of high-net-worth individuals and family offices. Salimi emphasized that Dao5’s approach goes beyond capital deployment. The firm takes pride in providing a full range of support services to the startups it backs.

“Sometimes the job of VC can range from everything to investor to close friend and then therapist of these young founders,” he said, highlighting Dao5’s close-knit relationships with portfolio companies.

While the first fund leaned into what Salimi described as “extremely sci-fi projects,” the focus this time is more grounded. The firm is steering the new capital toward infrastructure that could help bring traditional institutions into the crypto space—projects involving stablecoins, asset tokenization, and other core tools that enable real-world adoption.

In a market where many funds are shrinking or pausing operations, Dao5’s successful raise signals growing interest in pragmatic crypto solutions. Salimi noted that although the buzzier, more experimental ideas have waned in popularity, “it’s almost like the less sexy products are now more important.”

Editorial Note: This news article has been written with assistance from AI. Edited & fact-checked by the Editorial Team.

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