Multicoin Keeps Crypto Focus as HYPE Becomes Its Largest Hedge Fund Position

Multicoin Capital is keeping its investment focus on crypto even as artificial intelligence attracts a larger share of startup funding. The $2.7 billion manager’s strategy also extends into public tokens: general partner Spencer Applebaum said Hyperliquid’s HYPE is the largest position in its hedge fund.

That concentration makes the firm’s approach unusually legible. Multicoin is choosing to specialize in digital assets while some competitors widen their mandates to include AI and robotics. Its view, as Applebaum described it, is that experience and relationships in crypto can give the firm an edge. Whether that focus pays off depends on the opportunities the sector produces and how well the firm selects them.

A deliberate limit on the investment mandate

Multicoin has not made a standalone investment in an AI company, and Applebaum told Bloomberg the firm has no plans to expand its mandate to pure-play AI. “We believe we have an edge in crypto, and we want to stay true to it,” he said.

The choice sets Multicoin apart from firms including Paradigm, Framework Ventures and Haun Ventures, which have broadened their investment strategies as AI attracts capital. Paradigm raised $1.2 billion this year for a fund spanning AI, robotics and crypto. That wider remit gives a venture firm exposure to more sectors, while also asking its investors to assess businesses outside their original area of focus.

The scale of the shift toward AI is visible in the funding figures cited by the source. AI companies received roughly two-thirds of startup capital invested in the United States and Canada during the third quarter, Crunchbase reported. Multicoin’s stance is a refusal to treat that allocation as a reason, by itself, to change course.

Crypto fund deployment faces a slower market

Maintaining a crypto-only focus comes during a tougher stretch for managers raising and deploying capital. Galaxy Research data put investment in crypto startups at roughly $10 billion in the first half of 2026, close to the pace recorded the year before. Fund formation, however, has been more subdued.

In the second quarter, investors committed about $3.9 billion across five new crypto-focused venture funds. That was the fewest new funds since late 2019. Multicoin is also taking longer to put its $422 million venture fund, raised in 2022, to work.

Applebaum attributed the slower pace partly to lower valuations after FTX’s collapse. Seed rounds around 2023 were often roughly $3 million at post-money valuations of $30 million. For a large fund, that deal size can mean a longer deployment period: making investments in smaller companies takes time, and a manager may need many such positions to allocate a substantial pool of capital.

Those figures describe a market where funding remains active but the path from raising a fund to investing it can stretch out. They also help explain why a manager might be selective rather than expand into a fast-growing field simply to increase the number of sectors it covers.

HYPE leads the hedge fund’s public holdings

Multicoin’s crypto commitment is not limited to private venture deals. Applebaum said HYPE, the token associated with Hyperliquid, is the largest position in the firm’s hedge fund. The firm accumulated its tokens on the open market and typically holds public investments for years, rather than trading them over short periods.

The reported position signals the size of Multicoin’s exposure within that fund, but it does not establish how HYPE will perform or how the position compares with the firm’s total assets. Token prices can change, and a concentrated holding can make a fund’s results more sensitive to the fortunes of one asset. The source provides no position size, cost basis or breakdown of the rest of the portfolio.

That distinction matters when reading the firm’s conviction. A long holding period suggests a thesis built around expected development over time, but it also leaves the fund exposed to changes in the asset and the market. The available details show where HYPE ranks in the hedge fund, not the assumptions behind its valuation.

Multicoin’s central wager is that deep specialization will help it identify crypto opportunities while other investors spread attention across sectors. The firm’s performance will depend on whether that knowledge translates into sound choices through a slower fund deployment cycle and a market where capital is flowing heavily toward AI. For now, its clearest signal is the combination of a crypto-only venture mandate and HYPE as its leading hedge fund position.