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BitMEX joins its rivals in launching its own VC arm

Arthur Hayes, BitMEX CEO Arthur Hayes, BitMEX CEO

Quick Take

  • BitMEX Ventures is led by Kumar Dandapani, a former partner at Nth-Degree Analytics, a quant research, and development firm
  • BitMEX Ventures has invested in Blockfolio and was set to participate in a fundraising round for FRST, a cryptocurrency data technology company, according to a source
  • Other exchanges that have launched venture arms include Coinbase, Huobi, and Binance

Seychelles-based BitMEX, a platform that offers peer-to-peer trading of leveraged bitcoin contracts, has joined its rivals in launching a venture-capital unit to identify potential crypto firms to invest in, The Block has learned.

The new arm of the firm, which has not been previously reported on, is being led by Kumar Dandapani, global head of BitMEX Ventures. Dandapani, a University of Pennsylvania graduate, joined the firm in 2018. Previously, Dandapani was a partner at Nth-Degree Analytics, a quant research, and development firm.

Also working on the VC unit is Maxim Wheatley. He joined the company in September, according to his LinkedIn profile, as head of venture development. Per Wheatley’s LinkedIn, he is charged with leading “global seed-stage investment and partnership activities” for BitMEX Ventures. He previously worked at TTEC, a technology firm based in Colorado.

Already, one of its portfolio companies has announced BitMEX as a backer. Blockfolio, which announced a $11.5M Series A financing round in October, noted BitMEX as an investor. BitMEX was also set to participate in a fundraising round for FRST, a cryptocurrency data technology company, according to a source.

It’s not surprising that BitMEX has a venture unit considering some of its smaller rivals have already entered the market.

Coinbase, for instance, announced its venture unit in April. The firm counts more than 20 companies in its portfolio. [Editor’s note: Coinbase ventures made a small investment in The Block]. Huobi Labs, a subsidiary of cryptocurrency exchange Huobi China, made headlines with its $1 billion blockchain fund. It also announced in June an investment fund aimed exclusively at investing in Chinese and South Korean crypto startups. Per CoinDeskthe firm partnered with a number of Asia-based firms to raise $93 million.

Binance, the largest cryptocurrency exchange by volumes, also announced a $1 billion fund. TechCrunch reported the firm has also made investment deals via its Binance Lab’s unit, a social-impact fund. Binance led a $30 million round for MobileCoin, a privacy-focused crypto project that claims it was “designed to be used by everyone.”