Cryptocurrencies wiped out $19 billion in value last Friday in a show of the murky nature of deregulated markets. Goldman buys Industry Ventures as asset managers seek private shares. Oura’s ring attracts cash & General Catalyst leads the week in deals. Anthropic’s Jack Clark writes an essay, draws venom from David Sacks. Ron Conway splits with Marc Benioff as Salesforce boss veers to Trump. Bubble thoughts from Sequoia’s Roelof Botha.
The Main Item
The crypto money-spinning machine coughed a bit last Friday when a “flash crash” wiped out some $19 billion.
Traders were quick to call it a healthy “cleansing” of too much leverage — healthy at least if you weren’t the one being cleansed. The incident is a reminder, if any was needed, that crypto is presenting what economists like to call a “natural experiment” in deregulated financial markets, for good and for ill.
Reddit message boards were full of complaints this week from retail crypto punters who got caught in the squeeze, which was prompted by President Trump’s announcement of new tariffs on China. Crypto exchanges will automatically liquidate leveraged stakes if prices drop too hard, and 1.6 million accounts were abruptly wiped out. “This market is so fucking rigged,” one user wrote, with many others echoing the sentiment.
Alt-coins were hit particularly hard, with many becoming untradeable during the meltdown, sparking complaints of insider manipulation. Never mind, though: this is the age of deregulated finance.
A decentralized crypto exchange called Hyperliquid is the hot platform of the moment: it’s gaining fast on industry leader Binance with its trading in “perpetual futures,” a popular vehicle for crypto speculators, and it was at the center of last week’s action. Yet its mechanisms are opaque.
“Hyperliquid is still anchored by a small circle of insiders, raising questions about how decentralized it is,” noted Bloomberg. The Singapore-based platform, like many others, still doesn’t nominally accept US investors, but anyone can trade on its blockchain, no identity checks required.
Hyperliquid features a capital pool to provide liquidity for any trade. It held up okay this time, but there’s little agreement on how robust it would be in the event of even bigger market shifts.
Crypto boosters often point out that the blockchain offers intrinsic transparency, with its permanent record of every transaction. The seizure this week of $15 billion in bitcoins from an alleged Asian crime ring that ran “scam centers” in Southeast Asia is one piece of evidence that crypto isn’t always such a great way to do crime.
And yet, seeing a transaction on a blockchain is one thing, and tying it to a person is another. Crypto has arguably enabled whole new criminal industries, ranging from romance scams to ransomware, by providing an anonymous mechanism for moving large amounts of money outside the purview of government authorities.
The rise of stablecoins, meanwhile, is worrying central bankers who say the tokens are introducing systemic risk, in addition to enabling money-laundering. They would say that, of course, but there’s plenty of evidence that the biggest stablecoin, El Salvador-based Tether, is widely used for illicit transactions.
Moving large amounts of U.S. dollars into privately-controlled and lightly regulated crypto tokens obviously brings some risk. As if on cue, PayPal’s blockchain partner accidentally minted $300 trillion worth of the payment company’s PYUSD stablecoin on Wednesday, briefly making it the largest in the world, before realizing its mistake and “burning” it all. No harm, no foul?
It’s hard to imagine there’s much concern about all this at the White House, considering that the Trump family has already made north of $1 billion on crypto, according to a new Financial Times investigation. And that’s just the cash they’ve already taken out.
Crypto markets stabilized after the flash wipeout, but prices have drifted downwards all week, even as that old perennial, gold, has surged to new heights. Bitcoin as a store of value is still a new idea, and mainstream investors may be signaling some unease with all the crypto drama.
Industry leaders in every sector often argue that they can police themselves, and government regulations aren’t necessary. Crypto, if nothing else, will put that proposition to the test.
One Big Chart
As private markets gobble up more and more of global finance, big asset managers are itching to add more startup investments to their portfolios. This week featured a big move from Goldman Sachs.
The firm announced Monday that it plans to acquire Industry Ventures, a nearly 20-year-old firm that invests in startups and early-stage venture capital funds, and has lately been very active in secondary markets. Goldman will pay $665 million in cash and stock, with up to $300 million more contingent on performance through 2030.
All 45 employees of Industry Ventures will join Goldman Sachs, with founder & CEO Hans Swildens, along with senior managing directors Justin Burden and Roland Reynolds, set to become partners at Goldman Sachs Asset Management.
Swildens told us that Industry Ventures has seen incoming acquisition interest for several years now. Goldman, however, was already a major LP in the firm, and striking a deal with an existing partner was appealing.
“I’d call most of them friends now because it’s been so long — we’ve seen our kids grow up,” said Swildens.
With startups staying private longer, lots of the value creation from AI is still locked up in early- and growth-stage venture funds. Wealth managers know this, Swildens said, and purchasing a firm with strong holdings and access to multiple early-stage venture vehicles is a much easier path to getting a piece of that than backing startups directly.
The chart below from the PitchBook and the National Venture Capital Association Q3 2025 report illustrates the dynamic. Over 40% of all venture-backed unicorn startups are more than a decade past their first VC funding round, but still not accessible to most investors. With the rise of secondary market trading, money managers can land handfuls of shares here and there — or they can go big, as Goldman’s asset managers did with this deal.
Five Notable Deals
Mega-rounds were everywhere this week, with General Catalyst writing checks into three major deals. CalPERS, the California state retirement fund, invested in one of them.