Venture capital heavyweight Andreessen Horowitz, also known as A16z, is venturing beyond the United States for the first time with the opening of a new office in London. The move aims to capitalize on the city’s crypto-friendly regulatory environment and focus on investments in the cryptocurrency sector.
Following the footsteps of other Silicon Valley firms like Sequoia and General Catalyst, which established their London offices in 2021, A16z’s general partner Chris Dixon pointed to the UK’s progressive approach to decentralized assets as a key factor in the decision. Dixon stated that the UK is heading in the right direction to become a leader in crypto regulation.
This move comes at a time when the US government’s stance towards cryptocurrencies has become increasingly hostile, with the Securities and Exchange Commission recently filing lawsuits against major exchanges like Binance and Coinbase.
Simultaneously, the UK is actively working to attract more technology startups and investors, aiming to position itself as a prominent hub for Web3 and crypto innovation. Prime Minister Rishi Sunak expressed his ambitions to transform the UK into the world’s center for Web3 technologies.
A16z has been actively involved in the crypto space since 2013 and closed a $4.5 billion fund dedicated to the industry last year. With a total of over $7.6 billion raised, the firm has supported numerous crypto and Web3 startups across all stages.
While A16z is doubling down on its crypto and blockchain investments, the industry as a whole has experienced a notable decline in venture funding. In the first quarter of this year, global investments in crypto and blockchain startups amounted to $4.4 billion across 709 deals. This marked the fourth consecutive quarter of declining deal count and value, with Q2 also expected to show lower figures.
Interestingly, European crypto and blockchain startups fared better than their US counterparts in Q1, experiencing a 37.5% decrease in capital invested compared to the same period in 2022, while the US saw a significant 86.2% decline.
General partner Sriram Krishnan, who joined A16z in 2021, will spearhead the opening of the firm’s London office scheduled for later this year. A16z’s portfolio already boasts prominent UK-based crypto startups like Gensyn, a decentralized computer network, and Arweave, a blockchain protocol.