Crypto-native hedge fund Split Capital is drawing the curtains on its operations. Its founder Zaheer Ebtikar announced the development on Tuesday through an X post. Justifying the decision, Ebtikar said, the hedge fund model did not seem to be making sense for crypto.
Headquartered in Cayman Islands, Split was founded in 2023. At the time, Ebtikar said, the sector of crypto capital was lush with funds. After launching Split, however, Ebtikar observed that funds were coming back into the markets disguised as mispriced tokens in the ongoing bear market.
“I couldn’t fathom venture investors continuing to pile into generic layer one blockchains, in size and at massive valuations. I was broadly wrong. Most of my LP (limited partner) base was mostly people who told me not to raise a fund, they were broadly right in the end but still ended up backing me,” he noted.
Split Capital had become a prominent name for having adapted the “liquid token” strategy. It would invest in existing protocols not just in early-stage private equity.
During its functional tenure, the company invested in a bunch of Web3 projects like Strate and Ethena among others.
“Split Capital was a success by every measure that mattered. Virtually every investor made money, the fund was profitable both years and net well over 100 percent in returns between the fund’s inception in 2024 and the fund’s closure in 2025. I decided not to continue down the hedge fund model because the vertical was broken,” Ebtikar noted.
The crypto entrepreneur had started to wind down Split operations last year which have concluded now.
The next step
Now that Split Capital is bowing out of the crypto VC circle, Etbikar has decided to join Plasma — a stablecoin startup that Split itself had invested in alongside former PayPal CEO, Peter Thiel and Tether CEO Paolo Ardonio.
The Split founder said he spent months collaborating with the Plasma team, that is working on building a solid stablecoin settlement infrastructure.
As per Etbikar, within the first six months of exchanging ideas with the Plasma team he had “witnessed first hand the best team in crypto, being assembled in real time and witnessed the greatest go-to-market display in crypto history. Start to finish a novel blockchain being built in record time, with full supporting ecosystem, exchange and wallet integrations, record TVL, and the best partnerships in the world.”
At Plasma, Etbikar will be serving at the role of the Chief Strategy Officer, taking charge of work around partnerships and market image while also roping in investors and collaborating with governments ahead of the launch of the “Plasma One” project, details about which remain scarce as of now.
Despite being momentous in terms of crypto regulations globally, the year of 2025 recorded heavy consolidation for crypto venture capital firms. Several VCs tried to keep managing older investments without making new ones.
As per research reports, the number of new crypto funds hit a five year low in 2025. Complying with new regulations reportedly emerged as a complex global patchwork that tuned up uncertainty for large-scale investors.
Last year, DELV (formerly Voltz Protocol) also put an end to its corporate venture in 2025 owing to the absense of sustainable growth markers.