Web3 investment firm ABCDE, which manages a $400 million fund, has announced it will stop making new investments and will not raise capital for a second round. The fund will instead focus on supporting its existing portfolio of over 30 projects, maintaining its commitment to current entrepreneurs and liquidity providers.

The announcement was made on April 19 by ABCDE co-founder and Huobi exchange founder Du Jun, who cited deep concerns over the current state of the crypto industry. Jun criticized what he sees as a growing trend of short-term thinking among startups and primary market funds, accusing many of prioritizing fast exchange listings over long-term value creation. He also pointed out that some funds focus more on hype and market value than on real innovation.

Despite pausing new activity, ABCDE has invested over $40 million across the blockchain space in recent years, maintaining a top-tier internal rate of return. The fund has historically allocated 28% to Bitcoin scaling tech, 16% to Ethereum liquid staking infrastructure, and 12% to L2 platforms and restaking.

Jun’s future focus will now shift to strategic, long-term industrial partnerships through a new incubator brand called Vernal. The incubator, launching in May, will introduce new rules and investors while emphasizing deeper incubation and sustainable project growth.

Jun clarified that ABCDE’s investment halt isn’t due to financial issues but a principled response to the crypto market’s trajectory. His remarks echo recent warnings from Cardano founder Charles Hoskinson, who advocates for cooperative tokenomics to compete against centralized tech giants. Both leaders call for a rethink in how crypto builds for the future.