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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Shareholders of the healthcare services provider KindlyMD, Inc have approved a proposed merger with Bitcoin holding company Nakamoto Holdings, founded by US President Donald Trump’s crypto adviser, David Bailey.

KindlyMD and Nakamoto Holdings, a newly formed company that focuses on creating a network of Bitcoin-related entities, will both file information statements with the Securities and Exchange Commission, KindlyMD said in a May 20 statement.

The merger is expected to take place 20 days after both companies have shared the information statement with KindlyMD’s shareholders, with the transaction expected to be finalized in the third quarter of 2025.

Google Finance shows shares in KindlyMD (KDLY) closed the May 20 trading session up 9% at $15.22 and gained another 4.8% after the bell as the announcement of the approved merger came after the trading session ended. KDLY is up over 979% so far this year.

Shares of KindlyMD were up 4.8% after-hours on news that shareholders approved a merger with Nakamoto Holdings. Source: Google Finance.

The companies first announced the merger on May 12, saying the merged entity will use equity, debt, and other offerings to develop a slew of Bitcoin-native companies. Additionally, the company will also bolster its treasury by accumulating Bitcoin (BTC).

Companies continue to increase their Bitcoin holdings

A growing number of public companies have been adding Bitcoin to their balance sheets and have outpaced retail investors and exchange-traded funds, according to Bitcoin investment firm River.

Vivek Ramaswamy’s Strive said on May 20 that it intends to purchase Bitcoin claims tied to the defunct crypto exchange Mt. Gox and would look to buy 75,000 BTC at a discounted price.

Related: Bitcoin open interest hits record high as bulls stampede toward new BTC price highs

Strategy, formerly MicroStrategy, said on May 19 that it purchased 7,390 BTC for $765 million last week. The company’s top brass were also hit with a class-action lawsuit alleging they had failed to accurately represent the nature of the company’s Bitcoin investments.

Earlier this month, stablecoin issuer Tether bought nearly $459 million worth of Bitcoin for Twenty One Capital, a Bitcoin investment firm it backed that is awaiting the completion of a Special Purpose Acquisition Company (SPAC) merger with Cantor Equity Partners.

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The US Securities and Exchange Commission has delayed its decision on Bitwise’s application to add staking to its Ether exchange-traded fund and on Grayscale’s XRP ETF bid, which analysts had expected.

The SEC said on May 20 that it needed to extend its decision on Bitwise’s application by 45 days to “consider the proposed rule change and the issues raised therein.” The agency needed to either decide or punt its decision by May 22.

The agency also delayed deciding on Grayscale’s XRP (XRP) tracking ETF and Bitwise’s Solana (SOL) tracking fund while it seeks public comments and begins “proceedings to allow for additional analysis” of the proposals to ensure they meet regulatory standards.

Bloomberg ETF analyst James Seyffart said on X that both delays were expected as the SEC “typically takes the full time to respond to a 19b-4 filing.”

“Almost all of these filings have final due dates in October,” and an early decision would be “out of the norm,” Seyffart added. 

“No matter how Crypto-friendly this SEC is. There’s no conspiracy here,” he said.

Source: James Seyffart

Seyffart said delays on other spot crypto ETF bids are also expected, and the SEC is likely to delay deciding on Litecoin (LTC) ETFs too.

However, he added, “Litecoin is one that has a higher likelihood vs others of getting approved first.”

“A bunch of XRP ETPs have dates in [the] next few days. If we’re gonna see early approvals from the SEC on any of these assets, I wouldn’t expect to see them until late June or early July at the absolute earliest. More likely to be in early 4Q,” Seyffart added.

SEC dealing with flood of ETF filings 

Several other crypto ETF applications are approaching SEC deadlines in June. The SEC is supposed to decide on Grayscale’s Polkadot (DOT) tracking ETF by June 11 and 21Shares’ Polkadot ETF on June 24, according to an SEC filing.

Related: SEC charges Unicoin crypto platform over alleged $100 million fraud

The SEC received a raft of altcoin ETF filings in the wake of Donald Trump’s election in November and the following resignation of former SEC Chair Gary Gensler.

The industry saw Gensler’s time at the SEC as an era marked by an aggressive regulatory stance toward crypto, with 100 crypto-related regulatory actions during his tenure from 2021 until his resignation on Jan. 20.

With Genlser’s departure, the SEC is perceived as far more crypto-friendly, with several firms facing legal action from the regulator having had their cases dismissed, including crypto exchange Gemini on Feb. 26 and crypto trading firm Cumberland DRW on March 4.

Magazine: SEC’s U-turn on crypto leaves key questions unanswered