Cardano has highlighted its technology, but has lacked a strong institutional infrastructure. The new fund plans to change this by adding venture-capital discipline, connecting with a global investor network, and bringing in a Silicon Valley accelerator.
The Cardano Foundation and Draper Dragon have launched the Draper Dragon Ecosystem Fund, also known as the Orion Fund, with a target of $80 million.
Draper Dragon will manage the fund, and the Cardano Foundation will oversee it, but will not make investment decisions. Meanwhile, Draper University will support the fund by offering founder programs from its Silicon Valley campus.
The fund will invest its capital in stages over six years, and each stage will need separate community approval. The current vote is on the first and smallest stage and will determine whether the larger plan moves forward.
Focus on RWA, Institutional DeFi and more
The fund will focus on Real-World Assets and institutional DeFi, which match Cardano’s technical strengths. Cardano uses an extended UTXO model, like Bitcoin, which connects Bitcoin’s liquidity to Cardano’s smart contracts.
The Orion Fund will support projects that use this link, helping builders enable Bitcoin holders to use advanced financial apps while preserving the security of the UTXO model.
The fund will offer a public dashboard with real-time performance data and will hold community roundtables every quarter, following Cardano’s on-chain governance principles. A special-purpose vehicle called Arouet Holdings was established to manage the return of value to the Cardano treasury over time.
The fund differs from Cardano’s grant program in that it focuses on equity. Instead of disbursing funds without return, any investment profits will go back to the Cardano treasury. This makes the fund a long-term investment in Cardano’s financial health.
The fund’s institutional strength comes from Draper Dragon’s role in the Draper venture network, which Tim Draper founded. His portfolio includes early investments in Coinbase, Skype, Baidu, and Hotmail. Draper Dragon has also invested in Ledger, Gemini, EtherFi, Centrifuge, and Coinflow, showing its experience in Web3 infrastructure.
The fund’s goal is to raise Cardano’s TVL to over $3 billion, which would significantly increase the network’s on-chain economic activity. The effect of the Draper network’s institutional reach will be reviewed over the six-year period.
