Protect Your Investments with Web3: VC Exec’s Advice on Disruption Hedging

Why Major Investment Firms Still View Web3 as a Viable Option

The crypto sphere has experienced bouts of instability in the last few months due to the potential regulatory actions from global governing bodies and a continued bear market.

Despite the current state of the industry, investors are still providing financial aid to new businesses in the sector. Data reveals that in 2022, European DeFi startups experienced a growth of up to 120% in venture capital (VC) investment.

During the Proof of Talk blockchain conference, Cointelegraph had a conversation with Martin El-Khouri, a senior director at Bertelsmann Investments, to discuss why major investment firms still view Web3 as a viable option.

Bertelsmann Investments is one of the leading venture capital investment firms globally, having invested approximately 1.7 billion euros in more than 400 companies across the world.

El-Khouri informed Cointelegraph that the company initiated its initial investment into the Web3 domain in 2016 and the present state of the market really assists investors in differentiating between “noise and sound.”

He stated that he believes investing in Web3 is a “safeguard against disruption,” yet it can sometimes be “challenging to persuade” higher-ups in large multinational corporations to focus on Web3 given the fluctuating status of the industry.

He pointed out, though, that regulations are beneficial to the industry in terms of investments as they provide investors with a clearer understanding of what is being created.

He remarked, “The clearer the regulations are, the simpler it is to assess various kinds of companies.”

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He also highlighted the move in focus towards generative AI and AI startups. According to Marketsandmarkets, the AI market is estimated to reach $407 billion by 2027, as opposed to its $86.9 billion revenue in 2022.

El-Khouri asserted that, despite the fact that investors are turning their attention to AI, “blockchain and crypto will be more essential than ever before.”

He determined that blockchain will be especially beneficial when it comes to generating AI content, as it eliminates the necessity of a third party to address the “double spending problem” and provides a record of ownership for digital assets.

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