Investing in the Diffusion of Blockchain

Craig Burel  Mar 11, 2024


Our History

It’s been almost eight years since Reciprocal Ventures was founded, and Michael and I began investing in crypto. At that time, the concept of building anything on a blockchain, let alone high quality applications, was still in its infancy. User experience on blockchain was slow and clunky, reminiscent of dial-up internet, crypto conferences hosted crowds in the hundreds—now in the tens of thousands, and both ‘decentralization’ and ‘ICOs’ were still far-away concepts.

Since that time, we’ve successfully raised and deployed two funds across various verticals in blockchain. From infrastructure to developer tooling to gaming and L1s themselves, our funds have allowed us to touch many facets of an industry that’s only growing by the day. As we approach the next milestone ahead, we think it’s important to take a moment to pause and reflect on how we got here and why we do what we do.

Reciprocal’s roots stem from the hedge fund world, where ideas and research are your intellectual property or edge. In that world, petabytes of data are crunched daily, in order to identify opportunities and discover “variant perceptions.” There isn’t much public discussion of how and why investments take place, as this would be disadvantageous to the firm. But in crypto, things are different.

In crypto, we operate with transparency, the fundamental foundation of a decentralized future. And in the spirit of transparency, we’re going to give you a glimpse into our “multi-thesis” approach to investing in crypto — which we believe to be pretty distinct to Reciprocal.

Our Methodology

Boots On The Ground

The crypto space moves fast. To keep up with this accelerated pace of innovation, we choose to be plugged in at all times. We immerse ourselves deep in ecosystems and hold regular conversations with our portfolio companies, industry leaders, core developers, and pretty much anyone pushing the innovation envelope. This flood of high-quality insights and boots-on-the-ground approach helps inform our “operating theses” in real time. Staying engaged is a functional necessity of being a part of the crypto community. No absenteeism, no tourism. Fully emerged, always on.

Revolution, Not Evolution

Revolution is fast, abrupt, and violent, whereas evolution takes place slowly over millennia. Crypto is revolutionary, not evolutionary. Revolutionary ideas will seem radical at first and even cut against the grain of the higher-level technical trends in an industry. To develop conviction in revolutionary ideas, daring to dream is not enough; you need to research these new concepts alongside the people developing them. It’s imperative that we think like revolutionaries, expect radical change, and believe in what’s possible. 

Compounding Knowledge

The blockchain industry evolves rapidly, creating a cascade of new information that requires constant research in near real-time. Two of our founding principles, specialization and curiosity, have helped to shape our philosophy, process, and investment strategy. First, we believed that sector specialization would lead to deeper domain expertise and better returns. Second, we believed fostering a culture of curiosity, objectivity, and debate was imperative to surface the strongest investment ideas. These principles ensure our firm’s knowledge continues to compound over time. Compounding knowledge allows us to navigate complex waters and to make thoughtful, rational decisions in an industry that often appears chaotic and irrational to the casual observer.

Trust The Process

The crypto market is volatile and heavily cyclical. Dramatic price swings have the power to shift sentiment and warp one’s sense of time horizon and fundamental reality. A strong process has the power to keep you grounded. It creates discipline, accountability, and consistency, all of which help drive positive results. Our process is designed to isolate signals from noise. Each investment idea or thesis must be driven by unique observation and validated by primary research. As a result, we prefer to develop several specific theses and run them through our research process in real-time. We refer to this as a “multi-thesis” or “rolling thesis” approach, which enables us to remain agile and match the extreme pace of innovation in an ever-changing industry.

Our Practice

In thinking about our investment strategies over the last eight years, we tried to identify a consistent theme or driving force behind what we do. We were able to boil it down to one word: diffusion. In the traditional context, diffusion is a process that alters the structure and functioning of social systems by introducing innovation. Note that this innovation must also be new to society. In the context of our work, diffusion means supporting founders who are introducing blockchain and cryptocurrency to society. Understanding this internally has led us to develop somewhat of a purpose statement for the firm, which is this:

We back founders powering the diffusion of blockchain.

This is Reciprocal’s North Star. We seek to support bold visionaries building the tools that will make blockchain accessible for all people across all industries. More so, when we invest in a company, we are making a commitment to the founders that we have their back. This is a responsibility we do not take lightly. In many ways, our firm is designed to deliver on this promise. We all have a finite number of hours per day to split between investing, portfolio support, and other general responsibilities of life. This is why we keep our funds more concentrated, meaning we tend to back fewer founders and spend more time supporting them than the average venture fund. It’s also why we named the firm Reciprocal. Reciprocity is key to fostering productive partnerships, and we strive to live up to our name with every founder we back. Here, investments == partnerships.

We invest in the belief that the diffusion of blockchain technology throughout society is one of the largest-scale investment opportunities of our generation. This is an opportunity to reshape trust and the technical foundation of money, finance, and commerce. For a detailed overview of the theses we’re actively researching and investing in, read my recent post, How Crypto is Changing the World.

The Future

In this next phase of our firm, we are doubling down on crypto again. We will leverage our hedge fund DNA, entrepreneurial spirit, and the principles above to deliver on our core mission: to support the secular diffusion of blockchain technologies.

Our focus and commitment to the crypto sector will continue to drive compounding knowledge through market cycles. We will continue to make the most of radical opportunities, especially when the tourist generalist firms leave crypto to chase the new hot thing. We will continue to operate transparently and support the founders in solving the critical bottlenecks in this industry. But most of all, we’re excited. Excited to continue investing in the diffusion of blockchain technologies for many years to come. Excited to continue working with the brightest technologists and entrepreneurs in the world. And in some ways, eight years later is still just the beginning.

Craig Burel


Over the last four years, Craig has helped Reciprocal become a leading investor in the cryptocurrency sector, investing in some of the most successful projects in the space like Solana and The Graph. As part of Reciprocal’s interest in Digital Finance, Craig is actively investing in the Web3, Decentralized Finance, NFT, and Metaverse sectors.

Prior to joining Reciprocal, Craig was one of the first business hires at FiscalNote, an AI RegTech company, in 2014. At FiscalNote, Craig was responsible for revenue growth and go-to-market strategy as the Head of Revenue Operations & Strategy. Prior to FiscalNote, Craig worked at Morgan Stanley in their Institutional Equity Division as a Jr. Sector Specialist, focusing on the Media & Telecom space.

Craig received a B.A. in Economics from Lafayette College.

When he’s not experimenting with new money legos and minting obscure NFTs, Craig can be found on the golf course or searching for great surfing locales.

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