Alan Howard-Backed 10T Raises $750 Million for Debut Crypto Fund

(Bloomberg) -- Private equity firm 10T Holdings raised $750 million for its first fund to pursue investments in fast-growing cryptocurrency companies. 

It started gathering money from investors at the end of last year and has already deployed about 80% in mid-to-late stage companies in the ecosystem for digital assets, according to founder Dan Tapiero, who started 10T in 2020 after more than two decades of macro investing. Billionaire hedge fund manager Alan Howard is among the fund's biggest backers, along with public pensions including the Municipal Employees' Retirement System of Michigan, Tapiero said in a phone interview. 

“The space is growing so quickly that three years ago there were only a handful of companies that were at scale,” Tapiero, 53, said. “There's a nice pipeline here, too.”

The booming market for cryptocurrencies has drawn interest from across the world of high finance, with firms such as BlackRock Inc. embracing the underlying blockchain technology to handle complex equity derivatives. While the moves signal that digital currencies are becoming more mainstream, Bitcoin's plunge of as much as 17% on Tuesday underscores their perils. 

Read more: Bitcoin's Sudden Plunge Highlights Risk of Using It as Currency

Tapiero's firm only invests in the equity of digital asset businesses, not cryptocurrencies themselves. It has already backed 11 companies with a market value of at least $500 million, including digital exchange Kraken, blockchain lending startup Figure Technologies and Ledger SAS, the maker of hardware wallets, according to Tapiero. 

“There's tremendous volatility in these nascent markets because the participants are trying to figure out how to price the asset,” he said. “I still think Bitcoin is going up to $400,000 or $500,000 and potentially more, but it's not going to be a straight shot and you're going to have lots of volatility.” 

See also: John Paulson Says the Next Big Trade Is Anything But Crypto

Before founding Greenwich, Connecticut-based 10T, Tapiero worked at Tiger Management, Duquesne Capital Management and SAC Capital Advisors.

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