Crypto firm Meta4 gets backing from Andreessen Horowitz for new NFT investment fund

Meta4 NFT Fund I managing partner Brandon Buchanan
Meta4 NFT Fund I managing partner Brandon Buchanan Denise ‘DeeShooter’ Acevedo

Cryptocurrency firm Meta4 Fund Management on Thursday announced the launch of a fund to invest in rare non-fungible tokens with Andreessen Horowitz as its lead investor.

The fund, Meta4 NFT Fund I, is looking to raise $US100 ($AU133) million and is eyeing famous NFTs such CryptoPunk, CryptToadz, BoredApe Yacht Club, and Zed Run. It is managed by partners Brandon Buchanan and Nabyl Charania.

It isn’t the first foray into the space for Meta4. The Miami-based firm earlier this year launched its pilot vehicle, Meta4 Capital, with a mandate to buy digital art and collectibles, purchase virtual land, and trade NFT-related cryptocurrencies.

It has acquired dozens of NFTs, including CryptoPunks, Bored Ape Yacht Club, Meebits, Gutter Cat Gang, Zed Run, and Sandbox.

The two funds come as NFTs explode in popularity, capturing the attention of major institutions such as Visa. Major crypto exchanges like FTX and Coinbase have launched their own NFT marketplaces.

NFTs are digital representations of artwork, sports cards, or other collectibles tied to a blockchain and usually purchased with cryptocurrencies. When people buy NFTs, they gain the rights to the unique token on the blockchain, not the artworks themselves. But the fact that the information on a blockchain makes them next to impossible to alter, increasing their appeal to artists and collectors.

“NFTs are more than just pixels. It’s the intersection of culture, technology, and finance,” Buchanan said in a statement. “It represents a new way of thinking about the ways in which ‘value’ is accrued, harnessed, and distributed.”

Andreessen Horowitz, for its part, launched its first crypto fund in 2018. Since then, the tech-focused firm launched two more funds and has invested directly in NFTs.

“NFTs are the driving force behind a new generation of internet products and services that are sharing value directly between the millions of developers, artists, collectors, and even gamers that participate,” Arianna Simpson, general partner, a16z Crypto, said in a statement.

While NFTs have not received the same scrutiny as cryptocurrencies, the market has not been free of controversy and accusations of shady dealings. Mark Cuban-backed OpenSea, the largest NFT marketplace, found evidence of insider trading on its platform in September, the company confirmed in a statement.