Zhao’s investment fund eyes broader participation as U.S. regulators adopt a more crypto-friendly stance
YZi Labs, the $10 billion investment firm founded by former Binance CEO Changpeng “CZ” Zhao, is weighing whether to open its doors to external investors, signaling a potential shift in strategy as demand for crypto-focused funds accelerates.
The fund currently manages Zhao’s personal fortune alongside capital from early Binance insiders, including co-founder Yi He. Although it accepted around $300 million in outside commitments in 2022, much of that capital was later returned, as YZi Labs said its own scale was already “overwhelming.”
“There’s always a lot of external investors interested,” said Ella Zhang, head of YZi Labs. “We will eventually consider turning it into an external-facing fund. We just think it’s not there yet.”
Expansive portfolio in Web3 and crypto
YZi Labs has already built one of the largest venture portfolios in the sector, backing over 230 companies. Investments span key blockchain ecosystems and infrastructure providers, including Aptos Labs, Polygon, 1inch Network, Sky Mavis, LayerZero, Mysten Labs, and CertiK.
In a sign of changing dynamics, Zhang confirmed that the U.S. Securities and Exchange Commission (SEC) recently requested a private demo of YZi Labs’ portfolio companies. This comes after SEC Chair Paul Atkins, who assumed the role in April 2025, missed the firm’s demo day at the New York Stock Exchange.
“Paul Atkins and other commissioners, they are very open-minded,” Zhang added, suggesting a more favorable regulatory environment under the Trump administration.
Market timing and industry context
The potential move by YZi Labs follows a broader surge in crypto-native funds. Galaxy Digital recently raised $175 million for its first externally backed venture vehicle, surpassing its $150 million target.
Meanwhile, prominent analysts are shifting strategies. In July, Bitcoin researcher Willy Woo disclosed he had sold most of his Bitcoin holdings, arguing that Bitcoin infrastructure startups may deliver 100–1,000x returns compared to direct exposure to the asset.
Despite Zhao’s guilty plea in a U.S. AML case and four-month prison sentence, he remains Binance’s largest shareholder and is now pursuing a presidential pardon. His renewed focus on YZi Labs highlights an effort to redefine his role in the industry through institutional investment channels.
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