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Crypto VC firm Dragonfly raises $650 million despite ‘gloom of a bear market’

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Crypto VC firm Dragonfly raises $650 million despite ‘gloom of a bear market’

Crypto venture firm Dragonfly Capital completed a $650 million fourth fund, marking one of the largest raises in the sector at a time when many blockchain-focused VCs are struggling, Managing Partner Haseeb Qureshi said.

“It’s a weird time to celebrate,” Qureshi wrote on a social media post on Tuesday, describing low spirits and “the gloom of a bear market” for crypto. However, he noted that Dragonfly has historically raised capital during downturns, including the 2018 ICO crash and just before the 2022 Terra collapse, ‘vintages,’ he said, ultimately became the firm’s best performers.

In September, the firm said it was aiming to raise $500 million for its fourth fund, which would target early-stage projects. It has not yet identified any of them. In May 2023, Dragonfly Capital raised $650 million for its third crypto fund for later-stage companies.

‘Biggest bet yet’

The new vehicle comes as token prices slumped this year and fundraising across crypto ventures has slowed sharply. Bitcoin has lost roughly 46% of its value since its all-time high of more than $126,000 in October of last year, and the crypto downtrend has wiped out more than $1.4 trillion in market cap.

While market sentiment remains bearish, Qureshi is bullish on crypto’s financial use cases, saying the sector “is exploding,” while other non-financial use cases are failing. In fact, Dragonfly has increasingly leaned into crypto-financial infrastructure, from stablecoins to tokenization and on-chain payments, reflecting a broader shift away from speculative Web3 applications and toward blockchain-based financial services.

“Stablecoins are eating the world. DeFi has grown so big it’s rivaling CeFi. Financial institutions around the world are racing to build out their crypto strategies. And prediction markets are becoming the most trusted source of truth on the internet,” he wrote.

Qureshi also noted the growth in Dragonfly’s recent investments, including Polymarket, Ethena, Rain, and Mesh, as examples of his thesis that crypto’s financial use cases are having a moment.

His comments come after VC firms at Consensus Hong Kong 2026 struck a cautious tone about the state of the crypto market amid prevailing bearish sentiment. The crypto VCs that included Qureshi, Maximum Frequency Ventures’ Mo Shaikh and Pantera Capital’s Paul Veradittakit all echoed the same sentiment: invest in what’s working, like stablecoins and tokenizations, while selectively betting on sectors such as AI and prediction markets.

Qureshi seems to be doubling down on the idea that the crypto industry isn’t dead, despite the gloom, but just realigning and noted that the new fund is his firm’s “biggest bet yet that the crypto revolution is still early in its exponential.”

Fortune was first to report Dragonfly’s recent raise.

Stripe’s stablecoin firm Bridge wins initial approval to form national bank trust charter

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Stripe’s stablecoin firm Bridge wins initial approval to form national bank trust charter

Bridge, a stablecoin infrastructure firm owned by Stripe, said Tuesday it has received conditional approval from the U.S. Office of the Comptroller of the Currency (OCC) to form a national trust bank.

The charter would let Bridge National Trust Bank issue stablecoins, custody digital assets and manage reserves under direct federal oversight. It’s the latest step in Stripe’s broader push into blockchain-based payments since it acquired Bridge for $1.1 billion in 2024.

“This approval positions Bridge to help enterprises, fintechs, crypto businesses and financial institutions build with digital dollars inside a clear federal framework,” the company said in the press release.

Bridge says its systems already meet the compliance standards outlined in the Guiding and Establishing National Innovation for U.S. Stablecoins (GENIUS) Act, the law passed last year that’s aimed at regulating stablecoin issuers. Federal banking regulators, including the OCC, Federal Reserve and Federal Deposit Insurance Corp., haven’t yet instituted the specific regulations mandated by the GENIUS Act, but they’re moving through that process now.

Bridge is part of a growing group of firms seeking to build stablecoin products inside a federal framework. In December, Circle, Ripple, Paxos, Fidelity Digital Assets and BitGo all received similar conditional approvals from the OCC, and Erebor Bank was granted a conditional national bank charter in October. Bridge applied for its charter in October, and the OCC’s records show it signed off last week.

The company currently powers stablecoin issuance for products like Phantom’s CASH and MetaMask’s mUSD via Stripe’s Open Issuance platform.

The OCC has not announced a timeline for final approval.

Federal Appeals Court Rejects Kalshi Bid to Pause Nevada Enforcement

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Federal Appeals Court Rejects Kalshi Bid to Pause Nevada Enforcement

In brief

  • The Ninth Circuit has denied Kalshi’s emergency request for an administrative stay
  • Nevada can now file a civil enforcement action and seek a TRO
  • Kalshi may turn to the Supreme Court’s emergency docket to block enforcement

Federal appeals judges have rejected Kalshi’s emergency request to pause enforcement in its legal fight with Nevada regulators, a procedural setback that could allow the state to move swiftly to shut down the prediction-market operator’s activities.

The Ninth Circuit Court of Appeals on Tuesday denied Kalshi’s motion for an administrative stay, according to posts on X by sports-betting and gaming attorney Daniel Wallach. 

The decision removes a temporary shield that would have blocked Nevada from pursuing civil enforcement while the court considers a broader request for relief.

It comes as U.S. regulators and state authorities are taking a harder line against prediction markets that allow users to wager on real-world events, testing the boundaries between federally regulated derivatives and state gambling laws.

With no stay in place, Nevada is now free to file a civil enforcement action in the state court as early as Tuesday evening, Wallach said, adding that a temporary restraining order is expected within days. 

Such an order would likely force Kalshi to halt operations in the state while the dispute proceeds. Kalshi has declined Decrypt’s request for comment.

The case centers on whether Kalshi’s event-based contracts fall under federal commodities regulation, overseen by the Commodity Futures Trading Commission, or whether states retain authority to restrict the products as unlawful sports betting or gaming.

Kalshi has argued that federal law preempts state enforcement, pointing to its status as a CFTC-regulated exchange.

Nevada regulators have rejected that view, asserting jurisdiction over products offered to residents within the state.

Wallach said Kalshi’s next move could be an emergency application to the U.S. Supreme Court, potentially as soon as Tuesday evening. 

The court’s emergency, or “shadow,” docket allows justices to issue short-term administrative stays to preserve the status quo while lower-court proceedings continue.

Such intervention is discretionary and typically reserved for cases where immediate enforcement would cause irreparable harm.

The Ninth Circuit’s denial does not resolve the underlying legal questions, but it shifts near-term leverage toward Nevada, increasing the likelihood of rapid enforcement absent of a Supreme Court action.

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ConnectPay Launches In-House Core Banking System to Strengthen Resilience

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ConnectPay Launches In-House Core Banking System to Strengthen Resilience

ConnectPay, one of Lithuania’s largest fintechs, has completed the transition to its in-house core banking system, Mars, joining a small group of European fintechs that fully own and operate their core infrastructure as the industry faces growing resilience and regulatory demands through 2026.

Core banking systems act as the single source of truth for account balances, transactions, and payments. While most fintechs rely on third-party providers for this critical layer, ConnectPay made the strategic decision to bring the core in-house, removing its largest external dependency and significantly increasing operational resilience.

“With Mars, we removed the single biggest operational risk an EMI can have: dependency on an external core banking provider,” said Tadas Bakutis, CTO at ConnectPay. “If a third-party core goes down, clients feel it instantly. Now, we control the technology ourselves – which means faster issue resolution, greater stability, and the freedom to innovate without waiting on someone else’s roadmap.”

Speed that clients can feel

Beyond resilience, Mars enables ConnectPay to deliver product improvements in weeks rather than months. Previously, changes to the core depended on third-party release cycles and priorities. Today, ConnectPay can respond rapidly to regulatory changes, client needs, and market shifts.

As real-time payments become the standard of European financial infrastructure, such flexibility among companies is becoming increasingly important. With the EU requirement that all service providers must support instant payments by the end of 2025, it is projected that instant SEPA payments will account for 18% of all payments in Europe by 2035.

“For clients, the difference is simple: more stable services, faster product development, and stronger security,” added Bakutis. “And because we no longer pay external core licensing fees, this also creates long-term pricing advantages.”

A rare step in fintech

Building a core banking system is widely considered one of the most complex and capital-intensive undertakings in financial technology. It requires deep engineering expertise, strict regulatory alignment, and the ability to manage systemic risk – factors that lead most fintechs to outsource this layer entirely.

“As the industry enters its next phase – defined by instant payments, higher resilience standards, and deeper embedded finance – we believe infrastructure ownership will increasingly become a strategic advantage,” Bakutis summarizes.

ETH Mass Adoption Across TradFi Backs $2.5K Price Target

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ETH Mass Adoption Across TradFi Backs $2.5K Price Target

Key takeaways:

  • Institutional sentiment is shifting toward ETH as elite funds reallocate capital from Bitcoin to Ether ETFs.

  • BlackRock’s ETH ETF pairs secure staking with a low 0.25% fee, creating a major win for mainstream crypto access.

  • Dominance in the $20 billion real-world asset sector proves that big money prioritizes network security over low gas fees.

Ether (ETH) has failed to reclaim the $2,500 level since Jan. 31, leading traders to question what might spark sustainable bullish momentum. Investors are waiting for definitive signs of a favorable sentiment shift; meanwhile, three distinct events could signal the end of the bear cycle that bottomed at $1,744 on Feb. 6.

US-listed Ether spot ETFs daily net flows, USD. Source: CoinGlass

At first glance, the $327 million in net outflows from spot Ether exchange-traded funds (ETFs) in February is mildly concerning. The apparent lack of institutional appetite while ETH sits 60% below its all-time high could be seen as a lack of confidence in the $1,800 support level. However, these outflows represent less than 3% of the total assets under management for Ether ETFs.

Recent Ether ETF milestones may boost ETH’s price

While investors currently focus almost exclusively on short-term flows, the magnitude of recent Ether ETF developments will eventually reflect positively on ETH price. In bearish markets, positive news is often ignored or downplayed, but strategic moves from the world’s largest asset managers can quickly flip investor risk perception.

The latest US Securities and Exchange Commission filings showed on Monday that the Harvard endowment fund added an $87 million position in BlackRock’s iShares Ethereum Trust during the final quarter of 2025. Interestingly, this vote of confidence arrived as Harvard reduced its iShares Bitcoin Trust holdings to $266 million, down from $443 million in September 2025.

Latest notable iShares Ethereum Trust ETF holding changes. Source: Marketbeat

In parallel, BlackRock amended its Staked Ethereum ETF proposal on Tuesday to include an 18% retention of total staking rewards as service fees. While some market participants criticized the hefty fee, the ETF sponsor must compensate intermediaries like Coinbase for staking services. Moreover, the relatively low 0.25% expense ratio remains a net positive for the industry.

The final piece of evidence pointing to growing institutional adoption lies in real world asset (RWA) tokenization, a segment that has surpassed $20 billion in assets. Ethereum stands as the absolute leader, hosting offerings from BlackRock, JPMorgan Chase, Fidelity and Franklin Templeton. This intersection of blockchain applications and traditional finance may trigger sustainable demand for ETH.

RWA aggregate onchain market capitalization, USD. Source: DefiLlama

Nearly half of the $13 billion in RWA deposits on Ethereum represent tokenized gold, though investments in US Treasurys, bonds and money market funds grew to an impressive $5.2 billion. By comparison, the combined RWA listings on BNB Chain and Solana amount to $4.2 billion, a strong indicator that institutional money is less concerned with fees and more focused on security.

Related: Tokenized RWAs climb 13.5% despite $1T crypto market drawdown

Even if RWA issuers currently focus on closed-end systems using exclusive decentralized finance pools or their own layer-2 networks, intermediaries will eventually find ways to connect with the broader Ethereum ecosystem. Crypto venture capital firm Dragonfly Capital’s latest $650 million funding round signals a strong appetite for tokenized stocks and private credit offerings.

Rather than backing layer-1 blockchains and consumer-focused applications, investors are directing capital toward RWA infrastructure, institutional custody and trading platforms, a clear sign of market maturation. Although it is difficult to predict how long these shifts will take to impact Ether’s price, these events clearly indicate that a bounce back to $2,500 in the near term is feasible.