Inside VanEck Ventures' $40M Stablecoin and Tokenized Equity Thesis

From Circle to VanEck

Wyatt Lonergan joined Circle in 2018 through its acquisition of Seed Invest, then left to join VanEck Ventures. He met his fund partner, Juan Lopez, at Circle. Lonergan says the parent firm is 70 years old, commands over 200,000,000,000 in AUM and was one of the first to file for Bitcoin and Ethereum spot ETFs in 2016 and 2017. The venture arm can also do things off balance sheet and lean in from a product perspective, he says.

Payments and the conversion layer

Wyatt Lonergan says stablecoin usage is growing rapidly but is still at one to 2% penetration. VanEck Ventures views the fiat-to-stablecoin conversion layer as the real investable margin. It invests in ZAR, which lets consumers hold a non-custodial wallet and exchange local currency for stablecoins, and is working on an unannounced deal providing last mile fiat liquidity for stablecoin payments.

Lonergan points to Stripe, which he says had zero crypto strategy twelve months ago and now has an integrated one with Bridge, Privy and Tempo. He calls Stripe a $150,000,000,000 company that touches at most 2% of global B2B payment flows. He also cites OpenFX, which he says went from zero to tens of billions in twenty four months.

Tokenized equities and compliance

On capital markets, VanEck Ventures holds positions in Dinari, which Lonergan says offers tokenized equities from anywhere in the world through a single API, and recently invested in Legion for private fund access. He warns of a giant lack of compliance around tokenized equities, with secondary flows going untracked, and says agents placed in compliance workflows will make them better and better.

Picking founders

Wyatt Lonergan says the fund favors founders with deep domain expertise in their industry over broad crypto specialists. He says 90% of a venture portfolio is going to fail, so winners must return 200x, 500x or a thousand x.