(Bloomberg) -- The cryptocurrency industry is in crisis, but investors like Konvoy Ventures still see potential. The gaming-focused VC firm has raised $150 million for a new fund, which it plans to announce Wednesday. It will aim to spend about 20% to 30% of that money on blockchain and crypto-related games. 

Konvoy Ventures, founded in 2018 by brothers Josh and Jason Chapman and their childhood friend Jackson Vaughan, has already made big bets on blockchain technology. The Denver-based firm backed Sky Mavis, the developer of Axie Infinity, a virtual world where players breed and battle monsters attached to nonfungible tokens — one of the best-known blockchain games, and one of the most controversial. The firm also invested in Genopets, a game where players will be able to grow and evolve an NFT pet through real-world physical exercise, and Ready Player Me, a platform for designing virtual avatars that can wear NFTs. 

The use of blockchain and NFTs in gaming has attracted criticism. Some players argue that these elements don’t improve their experience and are just another way for gaming companies to profit. A $620 million hack also hit a blockchain network used by Axie Infinity in March, raising questions over the security of these games and whether the VCs backing them should be required to bail them out.

Jason Chapman, managing partner at Konvoy Ventures, declined to comment on whether his firm had participated in a $150 million funding round to help Sky Mavis reimburse players. But he said in an interview that the firm was prepared to help its portfolio companies weather a tougher market environment. 

“We're excited to back them through the thick and thin,” he said. 

His brother Josh said that the firm will consider making token-based investments instead of seeking equity. And outside of crypto, he said the firm will continue backing more typical gaming startups — including those that develop gaming infrastructure and intersect with industries like fashion, health care and education.

“One hundred percent exposure to crypto would not be the right strategy for us, but 0% would also be the wrong strategy,” Josh Chapman said in an interview. 

The brothers argued that, while changes in the gaming world often elicit pushback, blockchain has the potential to improve players’ experiences, including letting them potentially make money while playing. 

“This is just going to be another technology set that most people in games get to use,” Jason Chapman said. 

©2022 Bloomberg L.P.