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Fenbushi Capital’s $5.14M Crypto Fire Sale: A Lesson in VC Risks

Fenbushi Capital's $5.14M crypto asset sale reveals significant losses, highlighting the volatility and risks in venture capital investments.

Fenbushi Capital's $5.14M crypto asset sale reveals significant losses, highlighting the volatility and risks in venture capital investments.

I came across this article detailing Fenbushi Capital's recent sale of $5.14 million in crypto assets, and it got me thinking about the venture capital landscape in the crypto space. As many of you know, Fenbushi is one of the bigger names out there, and seeing them take such a hit raises eyebrows.

The Details: What They Sold

According to the article, they sold a bunch of different tokens including Eigen, UNI, SNT, COMP, AAVE, SUSHI and ETH. But what caught my attention was the massive losses they incurred on almost all of those positions. I mean, losing $2.44 million on SUSHI? Ouch.

They pretty much lost their shirt on COMP too, to the tune of $2.27 million. It makes you wonder what their strategy was going in and what it's like coming out.

The Broader Picture: Market Conditions

The current state of the crypto market has claimed yet another victim it seems. With so many downturns this past year or so (and let’s be real—there have been quite a few), it's no surprise that firms heavily invested in digital currencies are feeling the pinch.

But here's where it gets interesting: as per the article's analysis section, it talks about how VC firms are prone to herding behavior and leverage during bull runs which can amplify losses during bear markets. And just like that we see another cycle play out.

Are They Done?

So are they done? Or will we see more sales from them? One thing is for sure though; it’s risky business being a crypto VC these days!