For decades, venture capital has operated as one of the most exclusive asset classes in the financial industry. Participation typically requires large minimum investments, extensive paperwork, and years-long lockups that prevent investors from accessing their capital.
Blockchain is on track to change this, according to Carl Vogel, general partner at 6th Man Ventures.
Democratizing access to gatekeeping strategies
In a recent interview with TheStreet Roundtable, Vogel said that tokenization could allow venture funds to raise money directly on-chain, potentially opening the door to broader participation in strategies that were previously limited to institutional investors and wealthy individuals.
“I think that’s where things are headed,” Vogel said, referring to the idea of tokenized investment funds. “Anyone who has raised venture funding understands the challenges and complexities surrounding it and the amount of red tape that comes with it. With a more open system, the process could be much simpler.”
Tokenization allows ownership of investment vehicles to be digitally represented on the blockchain. In theory, this structure would allow investors to contribute money to the fund through an on-chain pool rather than a traditional private placement.
Some early versions of this model have already appeared on the crypto market. Platforms like Upshift and Midas allow investors to allocate capital to professional trading strategies such as delta neutral funds through tokenized structures.
“They still have traditional investors,” Vogel said. “But now people can also contribute money to these pools and participate in the yields generated by the best managers.”
The tokenized real-world asset market has grown to over $30 billion in value, highlighting the accelerating shift towards placing traditional financial products on blockchain infrastructure.
You can invest without stress
Vogel said one of the biggest advantages is the potential for liquidity. Venture funds and hedge funds often require investors to lock up their money for long periods of time.
“Traditional funds have long lockups, where you can’t withdraw your money for a period of time,” Vogel said. “Tokenized structures can create a secondary market where investors can sell their positions if liquidity is needed.”
More news:
- Oscar-nominated Hollywood actor warns Bitcoin will disappear
- SEC sends new cryptocurrency plan to White House
- Solana Foundation executive says new payment rails are emerging for AI agents
Tokenization may also enable more efficient financial strategies. Some on-chain systems allow investors to use tokenized fund positions as collateral or integrate with automated smart contract strategies to generate additional revenue.
Vogel believes that venture capital itself may take longer to move on-chain than other asset classes, but said a broader shift to tokenized credit and investment products is already accelerating.
“Everyone talks about tokenized stocks,” Vogel said. “But the reality is that credit is much harder to access for most people in the world. We think there’s a lot of opportunity there.”
If this trend continues, blockchain could gradually transform venture investing from a closed network of insiders to a more open financial market.