Are a16z’s Investment Legends Over as Token Prices of a16z-backed Projects Plummet?

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As different categories continue to rise in value, the total market cap of the entire crypto market has reached a steady $1 trillion. In light of the global economic downturn, however, some investors are still cautious about the current market conditions and therefore favor low-risk investment platforms and mainstream cryptos.

Despite that, there are still investors who, after investing most of their funds in stable products, choose projects with the involvement or lead investment from prestigious institutions. In this regard, a16z was the most popular institution among crypto investors in 2022.

Andreessen Horowitz (a16z) is a US-based private VC firm. Founded in 2009, the company has a track record of early investments in Internet giants such as Facebook and Twitter, and has later invested in notable companies including Coinbase, Slack, and Robinhood. Following its investment in Coinbase, a16z has gone on to back other hit projects such as Uniswap, Solana, MakerDao, Dfinity, and Chia. With a successful investment portfolio across a broad range of fields, a16z has become a beacon for many crypto investors.

Let’s now check out the projects backed by a16z in 2022 that have issued tokens but have not yet been listed on Binance to get a glimpse of a16z’s keen insights into crypto investment.

1. NYM

NYM is a decentralized privacy-preserving infrastructure that aims to address privacy breaches on the Internet. Its native token NYM is offered to users as the project’s reward. In 2021, NYM was a dominant player in the privacy category and raised $13 million at a valuation of $270 million. Yet it has always been hard for privacy coins to achieve market success, making it a challenge to create hit projects. As a result, NYM has plummeted, and the token price has kept falling. Although NYM is a Binance-incubated project, its public offering took place on other platforms, which makes us wonder if it has been abandoned.

According to CoinEx, a world-renowned crypto exchange, as of this writing, the NYM price stands at $0.2677, a 365-day decline of 87.95%.

Source: CoinEx

2. Chia Network

Chia Network gained global attention even before its official launch. As a large number of Chia mining machines flooded the market, the frenzy resulted in skyrocketing GPU prices and shortages. However, after its token came out, the Chia price plummeted. Chia is a network that aims to enhance blockchain security via Proof of Space and Time, while its token XCH is used for mining, transactions, and gas payments.

Data from CoinEx shows that, as of this writing, the XCH price stands at $41.82, down 93.4%.

Source: CoinEx

3. Goldfinch

In contrast, Goldfinch has remained obscure, but a16z has high hopes for the project. From mid-2021 to early 2022, in just six months, a16z helped Goldfinch raise $36 million in two financing rounds. As for the project itself, Goldfinch intends to become a fully centralized lending platform. Unfortunately, shortly after its second fundraising campaign, the market shifted its focus from DeFi to new categories like NFT and DAO, followed by the crypto crash in May 2022.

According to DeFiLlama, at the time of writing, Goldfinch’s TVL is $2.73 million, and data provided by CoinEx shows that the GFI price stands at $0.6852, a fall of 94.75%.

Source: CoinEx

Although NYM, Chia, and Goldfinch are all popular and highly-regarded projects in a16z’s portfolio, their token prices have been trending downward. This confirms the time-honored motto for all investors: don’t follow the crowd. In 2022, a16z invested in 101 projects, including many promising projects that have not yet issued tokens, so its portfolio still offers valuable references.

Based on our analysis, we can tell that following institutional investors does not guarantee steady profits; finding reliable investment channels and developing sound investment strategies is just the beginning of a healthy investment approach. Here, we won’t elaborate on investment strategies, but to investors looking for reliable platforms, we recommend CoinEx.

Founded in 2017 by ViaBTC Group, CoinEx has always put users first. Last year, the exchange redefined its brand slogan to “Making Crypto Trading Easier” and perfected its products, services, and trading markets to provide easy, convenient, secure, and efficient crypto trading services.

During the last five years, CoinEx has never suffered any security breach. With strict screening procedures, the exchange has listed 600+ cryptos and 1,000+ trading pairs. To date, the platform has provided a wide range of services that include spot trading, futures trading, margin trading, AMM, crypto finance, and CoinEx Dock for over 4 million users across more than 200 countries and regions worldwide.

Disclaimer: No investment advice is provided in this article, and all data mentioned herein are for reference only. You should not rely on the information provided herein to make any investment decision, and you will be fully liable for your own investment decisions.