Crypto Fund Inception Capital Winds Down, Founder Missing

• Inception Capital investors voted to wind down the fund after founder David Gan went silent for over a month during a family crisis.
• David Gan returned but agreed to step back from his role, leaving Inception Capital’s future uncertain amid paused investments.
• Despite challenges, Inception Capital plans to propose deploying the remaining 25% of unallocated capital to investors in October.

Inception Capital, an $80 million crypto fund supported by prominent investors, has started the process of a controlled wind-down. The decision was made after its founder, David Gan, went silent following a trip to China to assist with a family matter. 

Gan, a former Huobi executive and a Forbes 30 under 30 Asia honoree, originally raised $50 million for his venture fund, OP Crypto, in 2021. His fund grew, reaching nearly $100 million in assets under management by early 2024. But, Gan’s unexplained disappearance put investors in a difficult position, forcing them to take steps.

Founder’s Absence Raises Concerns

Gan’s sudden disappearance caused alarm among the fund’s limited partners (LPs). In May, he informed his investors that he was heading to China due to an investigation involving his father, a retired high-ranking Chinese government official. 

After sending the email, Gan remained out of contact for over a month. Consequently, LPs voted to implement a controlled wind-down of the firm during his absence. Upon his return, Gan agreed to step back from his key responsibilities within Inception Capital.

Inception Capital’s Uncertain Future

Following Gan’s leaving, Inception Capital’s future remains uncertain. The firm has paused its investments, let go half of its staff, and is now navigating a turbulent period. Despite these challenges, Inception has hired new deal analysts. 

Additionally, the firm plans to make a formal proposal in October that would allow investors to use the remaining 25% of capital that hasn’t yet been allocated. Yet, the uncertainty around the firm’s recent struggles has left investors wary about the future.

No Connection to Crypto Crimes

Although Gan’s father is under investigation, there is no evidence linking the case to Inception Capital or the cryptocurrency industry. Besides, the complex relationship between China and the U.S. has impacted the blockchain industry. However, Gan’s initial pitch was centered around bridging the gap between the Western and Asian crypto markets. Investors are now weighing the risks involved as they decide whether to continue with the fund or cut their losses.