Andreessen Horowitz to open office in London amid crypto crackdown in US

Venture capital firm Andreessen Horowitz, also known as a16z, has announced that it will open its first office outside of the U.S. in London later this year.

The firm believes that the U.K. will become a global leader in crypto, blockchain and digital currencies, and it is looking to take advantage of what it sees as a more welcoming environment for crypto entrepreneurs in the country.

Brian Quintenz, head of policy at Andreessen Horowitz, expressed confidence in the U.K.’s stance on crypto and its growth potential, saying, “The prime minister’s leadership is critical, but we have seen a wonderful openness to the promise of the technology, as well as a strong interest in whatever regulatory regime comes online, focusing on consumer protection… it’s a moment in time when the U.K. acts nimbly and quickly, but robustly.”

To spearhead its operations in London, Andreessen Horowitz has chosen Sriram Krishnan, an ex-Twitter employee and general partner at the firm. In addition to setting up an office, Andreessen Horowitz plans to launch its first crypto startup school in the U.K. This initiative aims to identify and nurture future talent in the crypto and Web3 space.

Andreessen Horowitz has already made significant investments in the crypto and Web3 sectors, backing notable startups such as Dapper Labs, the creators of a crypto-based sports collectibles trading game, and OpenSea, an NFT marketplace.

Strategic move

The announcement came amid a crackdown against the crypto industry by U.S. Securities and Exchange Commission (SEC), which follows the recent “crypto winter” and high-profile collapses like FTX. Most recently, the SEC sued cryptocurrency exchanges Coinbase and Binance for allegedly breaching its rules, including selling unregistered securities. The move shook the markets in the process.

Andreessen Horowitz general partner Chris Dixon believes that regulation should help stamp out crypto’s “casino culture.” The SEC’s crackdown on crypto exchanges is aimed at protecting investors from fraudulent activities and ensuring that crypto exchanges operate within the law.

The U.K. government is willing to create policies that encourage startups to pursue decentralization, which is a more sustainable approach to the crypto industry. The U.K. Financial Conduct Authority (FCA) has been working to regulate the crypto industry in the U.K., and the U.K. government has published proposals for how it plans to regulate crypto assets used in financial services.

The SEC’s crackdown on crypto exchanges is likely to put other U.S. crypto exchanges on notice. Under chairperson Gary Gensler’s direction, the SEC has been steadily asserting the agency’s jurisdiction over the industry, arguing that most tokens meet the definition of a security and should be subject to the same strict disclosure rules.

The agency has brought more than 130 crypto lawsuits and settlements to date, according to data from consultancy Cornerstone Research and the SEC website, and in several of those cases, has named specific tokens as securities.

Crypto companies, including Coinbase and Binance, are currently disputing the SEC’s authority, saying many tokens are more akin to commodities, and have repeatedly called for regulators to create clear rules rather than assert their jurisdiction.