YZi Labs is weighing opening its planned YZi Labs $10 billion fund to outside investors, signaling a potential shift toward institutional capital after earlier limited external allocations and regulatory engagement with the SEC. The fund currently holds stakes in 230+ blockchain firms.
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YZi Labs explores external investment for its $10 billion fund
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Fund holds positions in Aptos Labs, Polygon, LayerZero and more across 230+ portfolio companies
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SEC sought a confidential demo of portfolio companies; external allocations previously reached ~$300M in 2022
YZi Labs $10 billion fund explores external investors as SEC engagement grows; read on for portfolio, regulatory context and institutional implications.
What is the status of the YZi Labs $10 billion fund?
The YZi Labs $10 billion fund is currently a privately managed vehicle run by Changpeng “CZ” Zhao and insiders, with discussions underway about permitting external investors. The fund accepted roughly $300 million from outsiders in 2022 but later returned some capital, and leadership says now may not be the right time for a full external roll‑out.
How is YZi Labs positioned and what does its portfolio include?
YZi Labs manages stakes across more than 230 blockchain and Web3 companies. Notable holdings include Aptos Labs, Polygon, 1inch Network, Sky Mavis, LayerZero, Mysten Labs, and CertiK. According to Dealroom data, this breadth gives the fund deep exposure to infrastructure, security, scaling and applications across the crypto stack.
Why is YZi Labs considering external investors now?
Leadership cites sustained interest from external parties and a maturing institutional market for crypto venture exposure. Market activity—such as Galaxy Digital’s external fundraise—illustrates growing appetite among institutions for crypto-native venture allocations. YZi Labs is weighing timing, regulatory engagement and governance before expanding investor access.
What regulatory engagement has YZi Labs had with the SEC?
The SEC requested a confidential demo of YZi Labs’ portfolio companies, and senior SEC figures have shown increased openness to dialogue. Ella Zhang, head of YZi Labs, described constructive conversations and noted the commission’s interest in seeing demonstrable product and compliance practices from backed startups.
When did prior external capital enter and leave the fund?
External capital flows into YZi Labs totaled about $300 million in 2022, per public reporting. Management later returned part of that capital, citing the fund’s oversized asset base and operational cadence. Any future external raise would aim to balance investor access with prudent stewardship.
What does this mean for institutional crypto investing?
Opening a large crypto venture fund to outsiders would mark further institutionalization of the sector. It could increase capital available to early-stage blockchain firms and signal confidence among large allocators—while also requiring enhanced governance, transparency and regulatory compliance from fund managers.
Summary table: Fund comparison
| Fund | Target / Size | External Investors | Notable Notes |
|---|---|---|---|
| YZi Labs | $10 billion (planned) | Under consideration; prior ~$300M in 2022 | 230+ portfolio companies; managed by CZ and insiders |
| Galaxy Digital (example) | $175 million raised for external venture fund | External | Illustrates rising institutional interest |
Frequently Asked Questions
How much external capital has YZi Labs accepted previously?
In 2022 the fund accepted about $300 million from external sources but later returned some of that capital, citing fund scale and operational considerations.
What regulatory interaction has occurred between YZi Labs and U.S. authorities?
The SEC requested a confidential showcase of portfolio companies; leaders describe an increasingly constructive stance from regulators toward crypto innovation.
Key Takeaways
- Potential externalization: YZi Labs is considering opening its $10 billion fund to outside investors but has not committed to a timetable.
- Extensive portfolio: The fund holds stakes in 230+ firms across infrastructure, security and applications.
- Regulatory engagement: The SEC requested a private demo, signaling closer oversight and dialogue as the fund contemplates external capital.
Conclusion
The move by YZi Labs to consider external investors for its $10 billion fund reflects a broader shift toward institutional participation in crypto venture funding. As regulatory engagement grows and governance expectations rise, any external launch will hinge on timing, compliance and transparent investor protections. Watch for formal announcements from COINOTAG and YZi Labs for updates.
Publication: COINOTAG — Published: 2025-09-23. Updated: 2025-09-23.
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