Amsterdam-based Theta Capital Management has raised over $175 million for its latest fund-of-funds, aimed at supporting early-stage blockchain startups through specialized venture capital (VC) firms.

The new vehicle, Theta Blockchain Ventures IV, will channel capital into crypto-native VC firms with a track record in backing blockchain innovation, Theta’s managing partner and chief investment officer Ruud Smets told Bloomberg.

Smets said the strategy focuses on specialist managers who can outperform generalist investors in the earliest funding rounds.

“We’ve always been looking for areas where specialization and active management provide a sustainable edge,” Smets noted. He said that the experience and positioning of dedicated crypto VCs “has compounded over time,” creating barriers for less focused investors trying to enter the space.

Founded in 2001, Theta shifted its focus to digital assets in 2018 and now manages approximately $1.2 billion. The firm has previously backed leading crypto investment names such as Polychain Capital, CoinFund and Castle Island Ventures.

Source: Theta Capital

Related: AI takes nearly 60% of global venture capital dollars in Q1

Crypto VC deals rebound

The fund’s close comes as crypto venture capital begins to rebound. According to Galaxy Digital, VC investment in digital assets rose 54% in the first quarter 2025 to $4.8 billion, signaling renewed confidence in the sector after a prolonged downturn.

Another report from PitchBook revealed that crypto venture capital funding surged in early 2025, even as deal activity declined.

The report showed that 405 VC deals were completed in Q1 2025, a 39.5% drop from the 670 recorded in the same period last year. However, that’s a modest uptick from the 372 deals seen in Q4 2024.

Despite fewer deals, total funding more than doubled year-over-year, reaching $6 billion in Q1 compared to $2.6 billion in Q1 2024 and doubling from the previous quarter’s $3 billion.

PitchBook’s senior crypto analyst Robert Le noted that even amid macroeconomic uncertainty, “capital continued to seek crypto’s core utility rails.”

The bulk of the investment — around $2.55 billion across just 16 deals — went into companies in asset management, trading platforms and crypto financial services. Infrastructure and development firms followed, raising nearly $955 million across 30 deals.

Web3-focused companies saw the third-most deals and funding, at 23 and $231.2 million, respectively. Source: PitchBook.

Related: Crypto startups scaring away VCs with 80x valuations: 10T Holdings

Circle IPO could be crypto’s next benchmark

PitchBook also said that Circle’s anticipated IPO could be the most significant crypto equity pricing event since Coinbase’s 2021 debut.

If Circle secures a valuation above the rumored $4 to $5 billion range, it “could therefore crowd in new late-stage capital and reset valuation expectations upward across the payments and infrastructure stack,” Le said.

With $1.18 billion in VC funding raised so far, PitchBook estimates a 64% chance that Circle will ultimately go public.

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