Key Takeaways
- • Dragonfly, a San Francisco-based crypto venture capital firm, has acquired MetaStable, one of the oldest and highest-performing cryptocurrency hedge funds founded in 2014, in an undisclosed transaction that marks Dragonfly's first digital assets hedge fund acquisition.
- • MetaStable's track record includes early investments in Ethereum, Filecoin, and Algorand, with historical returns exceeding 500%, and more recent positions in Floating Point Group and Iron Fish protocol; the fund was backed by Sequoia and a16z.
- • Dragonfly managing partner Haseeb Qureshi, who previously worked as a partner at MetaStable, announced the acquisition, stating the combined firm is now "more expansive than it's ever been" and representing a significant expansion of Dragonfly's investment capabilities.
- • Dragonfly closed its third venture fund at $650 million (oversubscribed) in late 2025, building on its $250 million second fund closed in 2021, and the firm is concurrently acquiring 10 million LDO tokens (1% of Lido DAO's supply) at $1.45 per token with a one-year lockup period following DAO approval.
- • As part of a broader brand overhaul announced simultaneously, Dragonfly has dropped "Capital" from its corporate name and now operates under an expanded structure that includes Dragonfly Ventures, Dragonfly Liquid, and MetaStable as distinct operating divisions.
Summary
Dragonfly, a cryptocurrency-focused venture capital firm based in San Francisco, has completed its acquisition of MetaStable, marking the firm's entry into the digital assets hedge fund space. MetaStable, founded in 2014, represents one of the longest-standing and highest-performing cryptocurrency hedge funds in the sector, having received backing from prominent venture investors Sequoia and a16z. The acquisition price was not disclosed.
MetaStable's investment credentials are substantial within the crypto ecosystem. The fund was an early investor in foundational protocols including Ethereum, Filecoin, and Algorand, generating returns exceeding 500% at peak performance. More recently, the fund has deployed capital into trading platform Floating Point Group and layer-1 protocol Iron Fish, demonstrating continued activity in emerging infrastructure. Haseeb Qureshi, Dragonfly's managing partner and formerly a partner at MetaStable, announced the acquisition in a Monday statement, characterizing the combined entity as "more expansive than it's ever been."
The acquisition comes at a moment of significant momentum for Dragonfly's fundraising efforts. The firm closed its third cryptocurrency venture fund at $650 million on an oversubscribed basis in late 2025, substantially exceeding its second fund, which closed in 2021 at $250 million. The firm has maintained strategic focus on native protocols, Web3 initiatives, and token-based projects aimed at creating new digital economies, according to General Partner Tom Schmidt.
Concurrently with the MetaStable acquisition announcement, Dragonfly announced a corporate rebranding that removes "Capital" from its name and establishes an operational structure encompassing Dragonfly Ventures, Dragonfly Liquid, and MetaStable as distinct divisions. Additionally, Dragonfly is acquiring 10 million LDO tokens—representing 1% of Lido DAO's total token supply—following approval by Lido token holders earlier in March 2026. The firm committed to purchasing the tokens at $1.45 per token or at the two-week average price plus a 5% premium, whichever is higher, subject to a one-year lockup period.
MetaStable's investment credentials are substantial within the crypto ecosystem. The fund was an early investor in foundational protocols including Ethereum, Filecoin, and Algorand, generating returns exceeding 500% at peak performance. More recently, the fund has deployed capital into trading platform Floating Point Group and layer-1 protocol Iron Fish, demonstrating continued activity in emerging infrastructure. Haseeb Qureshi, Dragonfly's managing partner and formerly a partner at MetaStable, announced the acquisition in a Monday statement, characterizing the combined entity as "more expansive than it's ever been."
The acquisition comes at a moment of significant momentum for Dragonfly's fundraising efforts. The firm closed its third cryptocurrency venture fund at $650 million on an oversubscribed basis in late 2025, substantially exceeding its second fund, which closed in 2021 at $250 million. The firm has maintained strategic focus on native protocols, Web3 initiatives, and token-based projects aimed at creating new digital economies, according to General Partner Tom Schmidt.
Concurrently with the MetaStable acquisition announcement, Dragonfly announced a corporate rebranding that removes "Capital" from its name and establishes an operational structure encompassing Dragonfly Ventures, Dragonfly Liquid, and MetaStable as distinct divisions. Additionally, Dragonfly is acquiring 10 million LDO tokens—representing 1% of Lido DAO's total token supply—following approval by Lido token holders earlier in March 2026. The firm committed to purchasing the tokens at $1.45 per token or at the two-week average price plus a 5% premium, whichever is higher, subject to a one-year lockup period.
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