UAE Investment Firms’ New $500 Million Fund Targets DePIN, AI

Hodler Investments and Gewan Holdings have announced the launch of a $500 million Digital Energy Infrastructure (DEI) Fund. This initiative aims to advance digital infrastructure through decentralized physical infrastructure networks (DePIN), artificial intelligence (AI), and blockchain technology.

The fund is structured as a closed-ended exempt fund, pending regulatory approval.

DEI Fund Targets Sustainable Digital Infrastructure

The DEI Fund will offer professional investors the opportunity to invest in utility-like income-generating assets and distributed energy infrastructure. This infrastructure is crucial for compute applications that integrate advanced carbon capture, storage, and utilization methods, aligning with global sustainability goals.

The DEI Fund’s capital will be allocated toward technology startups and software companies that enhance the fund’s portfolio. These investments will target early to growth-stage companies involved in digital infrastructure, financial technology (fintech), decentralized finance (DeFi), Web3, blockchain, and AI. The fund aims to foster innovation and growth in the digital infrastructure sector by acquiring and supporting these companies.

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Hodler Investments has partnered with Ento Capital Management Ltd, a Dubai International Financial Centre (DIFC)- based asset manager regulated by the Dubai Financial Services Authority (DFSA), to advise on the fund’s structure, establishment, and management. Ento Capital’s expertise in ethical investing further supports the fund’s commitment to responsible investment practices.

Meanwhile, Gewan Holdings, a key partner in establishing the DEI Fund, brings additional expertise and resources to the initiative. The fund’s capital commitments will focus on providing Limited Partners with exposure to an existing energy envelope that includes offtake commitments and deal flow from a portfolio of high-growth companies. With over $300 million in exclusive deal flow secured across various regions, the DEI Fund is strategically positioned to capitalize on the growing demand for digital infrastructure.

Amer Al Osh, Gewan’s Chief Development Officer, emphasized the importance of regulatory compliance and the positive investment climate in the UAE. He believes these factors have contributed to the fund’s potential for success.

“Given recent advancements in UAE regulations around digital assets and, more specifically, the recent landmark steps by the UAE’s financial jurisdictions to enact favorable laws for digital assets and AI sectors, we see improved investor sentiment for this type of asset class,” Osh said.

Why DePIN and AI Are Game Changers

The DEI Fund’s focus on DePIN and AI sectors aligns with industry reports highlighting the transformative potential of these technologies. For instance, a report by Bitwise emphasized the significant impact that the convergence of AI and blockchain could have on the global economy. The report projects that this intersection could add up to $20 trillion to global GDP by 2030, showcasing the importance of strategic investments in these sectors.

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Similarly, Franklin Templeton’s recent analysis shed light on how DePIN projects will shake up the traditional infrastructure industry. Taking the telecommunications sector as an example, projects such as Helium illustrate the power of decentralized networks. These projects can deliver wireless coverage with significantly lower costs than conventional carriers.

By leveraging collective hardware, data, and computational resources, DePIN projects reduce operating costs while boosting efficiency. Consequently, they become appealing investment options for entities like DEI.