VC Investors Find Complicated Ways to Monetize Locked-Up Crypto

Cryptocurrency investors are locking in returns from digital assets they’re ostensibly barred from selling by entering into complex arrangements with specialist trading firms.

Venture-capital companies and other investors sitting on tokens that cannot yet be traded on the open market are working with market making firms to hedge their positions, according to seven people familiar with the matter, some of whom declined to be named because the arrangements are confidential.

The total value of all digital assets in circulation roughly doubled in 2024, according to CoinGecko data, yet the industry’s venture investors have struggled to produce tangible returns. A ...