Binance Founder's Investment Firm Considers External Capital for $10 Billion Fund
Cointelegraph reports that Changpeng "CZ" Zhao's $10 billion investment firm YZi Labs is considering opening to outside capital and external investors. YZi Labs currently manages Zhao's personal fortune and funds from early Binance insiders, including co-founder Yi He.
Ella Zhang, who heads the fund, told the Financial Times there is always significant external investor interest. She stated the firm will eventually consider turning into an external-facing fund but believes it is not ready yet. The fund previously accepted about $300 million in outside funding in 2022 but later returned part of it due to the overwhelming scale of capital already under management.
YZi Labs portfolio includes prominent crypto and Web3 projects such as Aptos Labs, Polygon, 1inch Network, Sky Mavis, LayerZero, Mysten Labs and CertiK. The fund has over 230 companies in its portfolio according to Dealroom data. Zhang told the Financial Times the SEC recently requested a private demo of companies backed by YZi Labs after SEC chair missed the fund's demo day at the New York Stock Exchange.
Why This Matters
The potential shift represents a major evolution for YZi Labs, which was rebranded from Binance Labs and operates as Zhao's family office following his four-month prison sentence. Family offices typically manage wealth for a single family without raising outside capital, making this consideration a departure from the traditional model.
Fortune reports that Galaxy Digital recently raised $175 million for its first externally backed venture fund, exceeding its initial $150 million target. This trend shows growing institutional appetite for crypto-native investment vehicles. The Galaxy fund focuses on stablecoins, DeFi applications, and practical blockchain use cases rather than speculative investments.
Zhang acknowledged YZi Labs has deep experience in Web3 investments but remains in early stages of building expertise in artificial intelligence and biotechnology. The fund received over 50 pitches from teams wanting to raise token-based funds during summer 2025. Around 70% of its portfolio remains in digital assets, though interest in AI and robotics is rising according to Zhang's statements.
Industry Implications
YZi Labs' move comes amid rising demand for crypto investment funds and changing regulatory attitudes under the Trump administration. OneSafe Blog reports JPMorgan forecasts a $60 billion surge in institutional crypto investments by 2025, driven by U.S. regulatory clarity and growing institutional participation.
The potential conversion would position YZi Labs as a more influential player across multiple industries beyond crypto. Data shows 11 consecutive weeks of inflows into crypto funds, with Bitcoin-related investment products accounting for 83% of new assets. This pattern reflects robust confidence among institutional stakeholders seeking portfolio diversification with uncorrelated assets.
We reported that 15 US states are moving forward with plans for Bitcoin reserves, with Pennsylvania, Arizona, and New Hampshire proposing allocations up to 10% of public funds for Bitcoin purchases. This government-level adoption creates additional institutional demand that could benefit funds like YZi Labs if they open to external capital.
The SEC's request for a private demo of YZi Labs portfolio companies shows increased regulatory openness under chair Paul Atkins, who has served since April 2025. This regulatory shift, combined with growing institutional crypto demand, creates favorable conditions for family offices to transition into external-facing investment vehicles. However, Zhang noted managing outside capital would be "a huge responsibility" requiring expanded expertise and compliance capabilities.
