Reportedly, Paradigm, a crypto venture capital firm, is in discussions to raise a new fund amounting to as much as $850 million. These talks come as cryptocurrency markets have seen a resurgence in recent months. If successful, this raise would mark the largest in the crypto sector since May 2022 when Andreessen Horowitz raised a record-breaking $4.5 billion.

Paradigm's potential raise would surpass its previous record of $2.5 billion in November 2021 during the peak of the last bull run. Earlier reports suggested Paradigm aimed to raise a $1 billion fund. Notable investments by Paradigm in the Web3 space include Coinbase, Fireblocks, Blast, Optimism, Uniswap, Gitcoin, and friend.tech.

Recently, a Paradigm-led funding round propelled Merkle Manufactory, the firm behind decentralized social network Farcaster, to unicorn status with a valuation exceeding $1 billion.

Despite successes, Paradigm faced setbacks, notably investing $278 million in FTX, which later filed for bankruptcy. VC fundraising for crypto projects hit a low of $445 million in October 2023 but has rebounded, reaching $1.16 billion in March 2024.

The infrastructure and decentralized finance (DeFi) sectors received the most funding in 2024, totaling $1.14 billion and $459 million, respectively. However, nonfungible token (NFT)-related VC funding experienced a significant drop, falling from $3.4 billion in 2022 to $281.3 million in 2023.

This decline aligns with decreasing floor prices of major NFT collections, such as CryptoPunks and the Bored Ape Yacht Club, which saw drops of around 63% and 90% respectively from previous highs.