Unlocking Innovation with Blockchain VC Funds
Unlocking Innovation with Blockchain VC Funds
We could not be more excited. After more than 8 years during which we have met with Cambridge Associates to talk in depth about Blockchain and Crypto, we received in our inboxes their latest Cambridge Associates Insights report:
Unlocking Innovation with Blockchain and Crypto Venture Capital Funds - Published November 21, 2025
The report is very clear and concise and informed with a decade of detail analysis. It concludes:
The rapid evolution of the sector is creating new frontiers for innovation, diversification, and growth, with BCVC [Blockchain and Crypto Venture Capital] funds standing out as a strategic way to access these transformative opportunities.
We [Cambridge Associates] believe their strong track records, differentiated exposure to emerging themes, and potential for outsized returns make them a compelling complement to traditional VC strategies.
Looking ahead, the dispersion of outcomes among BCVC funds underscores the importance of rigorous manager selection and thoughtful portfolio construction, investment pacing, and manager sizing.
Investors who approach the space with discipline, deep research, and a willingness to engage with specialist managers will be best positioned to capture the next wave of digital innovation.
A modest allocation [FE Note: CA notes up to 1-2% of total portfolio assets] to BCVC funds can deliver meaningful exposure to the technologies and business models driving the future of finance and beyond.
As the digital asset ecosystem matures, the case for including BCVC funds in family and institutional VC portfolios is only growing stronger.
Those who act proactively and intentionally will diversify their VC portfolios and gain access to the engines of tomorrow’s growth.
The above link will take you to the short but informative report directly. What follows is a quick summary of key points.
WHO ARE CAMBRIDGE ASSOCIATES?
Cambridge Associates is a global group of companies that provide investment management, investment advisory, research, and performance reporting services.
For many institutional investors they represent the 'gold standard' for analytically based advice on asset classes. Trillions of dollars of institutional capital is guided by collaborations of one sort or another with Cambridge Associates.
WHAT IS IN THE REPORT THEY JUST PUBLISHED?
There is a lot of interesting perspective in the report and we encourage each of you to download the PDF above, and read it for yourselves - it is a quick read.
In essence, Cambridge Associates are fact based investment management advisors and they don't express an opinion until they have enough data to support it.
As noted in the introduction, we have been talking with Joe Marenda and other CA team members for more than eight years about our funds, and about Blockchain and Crypto more broadly, and now, armed with enough years of data, CA is coming out with a very clear recommendation to all investors. Venture fund performance is key to their evaluation of the space, and Exhibit 1 from their report makes a simple case:
Blockchain and Crypto Venture Funds have outperformed most other areas of venture capital, and indeed, most other asset classes.
Over 20 percent pooled IRR for both the five and ten year timeframes.
Exhibit 1: Cambridge Associates Assessment of Blockchain and Crypto Venture Capital Returns
While we are not allowed to share our own fund performance in a public newsletter, we can say that our first fund, which is in the same cohort as the funds analyzed by Cambridge Associates, exceeds the returns in Exhibit 1.
WHY INVEST NOW?
Performance is a rear view mirror exercise. What matters is what is coming next.
Cambridge Associates lays out a number of key and powerful investment thematic drivers that they expect to continue to drive returns. Readers of this newsletter will recognize them clearly:
Several key trends—such as the convergence of crypto and artificial intelligence (AI), tokenization of real-world assets, and the rapid evolution of stablecoins demonstrate the unique value creation opportunities accessible through BCVC-backed ventures:
Crypto and AI Convergence. Decentralized platforms are unlocking new models for collaboration and value exchange.
Tokenization of real-world assets. Blockchain technology is facilitating the digital representation and ownership of assets such as commodities, stocks, and bonds.
Stablecoins. Stablecoins have become foundational infrastructure for decentralized finance, trading, and cross-border payments, with market capitalization and transaction volumes now rivaling traditional payment networks.
These innovation themes, among many others, are directly shaping the evolution of the blockchain and crypto VC landscape.
We could not agree more. The next decade will see an acceleration of value creation as these powerful innovations transform every aspect of the global economy and usher in an era of digital monies, commodities, and assets running on blockchain infrastructure.
IMPLICATIONS FOR DISCIPLINED INVESTORS
Cambridge Associates has run the numbers and talks through portfolio considerations and allocation targets in the report.
In summary they conclude:
For investors with VC exposure, this may mean allocating up to 1%–2% of the total portfolio exposure to BCVC.
Please follow this link to download a PDF of this important report:
www.fifthera.com/blog/unlocking-innovation-with-blockchain-and-crypto-venture-capital-funds
Most importantly do not hesitate to reach out to us if you need 1%-2% of your total portfolio allocated to Blockchain venture capital funds by contacting our team at IR@FifthEra.com.
We look forward to talking to you about our investment perspectives and activities.
The Fifth Era Partner Team
About Fifth Era
We are entering a period of unprecedented innovation we call the Fifth Era, and every industry and business will be dramatically impacted. We focus on investing into these new innovations. Fifth Era specializes in investment strategies which construct portfolios of hard-to-access funds and direct investments through our investment strategies - AI Access and Blockchain Coinvestors. Fifth Era's investment strategies are now in their 12th year and to date we have invested in a combined portfolio of 1,500+ companies and projects including 80+ unicorns. In the US we are a SEC registered investment advisor, in the UK a FCA appointed representative and our funds are registered in Switzerland. Visit us at www.FifthEra.com to learn more.
SEC Registration does not imply a certain level of skill or training.
“Focused on Innovation”