Tether Makes Its First Dive into Venture Capital by Injecting $2M into Arcanum Capital's Fund

Tether (USDT) has invested $2 million into the venture capital space through Arcanum Capital's Arcanum Emerging Technologies Fund II.

Stablecoin giant Tether has announced its entry into the world of venture capital with a $2 million injection into Arcanum Capital's fund, which is dedicated to developing Web3 projects on the blockchain.

According to a press release on Monday, Tether (USDT) is making its first foray into venture capital with a $2 million investment in Arcanum Capital's Arcanum Emerging Technologies Fund II. The fund, which is a part of DigitalArray, focuses on developing decentralized technologies.

Arcanum Capital will use a portion of Tether's investment to support Web3-centric projects that combine AI and blockchain technology, build on the Bitcoin (BTC) ecosystem, and create innovations in crypto payments, among other initiatives.

Meanwhile, a part of the Arcanum fund will also be allocated to enhancing the utilization of USDT for payments and accelerating work on projects that leverage Holepunch technology. Backed by Bitfinex, Tether, and Hypercore, Holepunch is a platform for building peer-to-peer apps.

This marks the first time that Tether has participated in venture capital, making a substantial contribution to the growth of venture capital in the blockchain space.

Paolo Ardoino, CEO of Tether, expressed optimism about the collaboration with Arcanum Capital, stating that the partnership between the two companies will lead to the creation of innovative tools that can empower individuals during challenging times.

“In a world increasingly shaped by geopolitical tensions and macroeconomic uncertainty, the need for resilient technology to safeguard our freedoms has never been more crucial,” said Ardoino in a statement.

James McDowall, Managing Partner of Arcanum Capital, said Tether's investment aligns with Arcanum's goal of creating transformative technologies that further advance the blockchain space.

“We are honored to have Tether as a founding investor in our second fund,” said McDowall. “Their contribution not only signals a strong vote of confidence in us as asset managers, but also validates our unique mission and approach.”

Earlier this month, Tether's CEO unveiled the areas in which the firm has invested, including Bitcoin mining, TradFi, and commodity trade. As Arcanum Capital marks the first time that Tether has invested in a venture capital fund, it remains to be seen whether the stablecoin will make similar investments in the future.