The State of Crypto Venture Investment in the First Half of 2023
After a significant downturn in the crypto market, the venture investment market has found its bottom in the first half of 2023. However, the recovery trend in fundraising has not been observed yet, with the raised amount falling by 87% in Q2 2023 compared to Q2 2022.
Key Points:
– $5.1B was raised across 619 funding rounds in the first half of 2023.
– Service, СeFi, and Infrastructure startups received the highest amount of funding.
– Stripe closed a $6.5B funding round, making it the largest crypto raise in the first half of the year.
– Vitalik Buterin, Jack Dorsey, and Sam Altman were prominent investors in the funding rounds.
– Blockchain Service emerged as the dominant category, capturing 38% of total investments.
The Rise of Blockchain Service:
Blockchain service projects are leading the way in fundraising due to the growing adoption of Web3 technologies. They bridge the gap between web2 and web3, making decentralized networks more convenient. Noteworthy blockchain service projects in 2023 include Ledger and EigenLayer.
VCs Focus on Early-Stage Rounds:
VCs prioritize pre-seed and seed rounds, accumulating over $1 billion USD in funding. The number of successfully closed rounds tends to decline in later stages, but the average amount raised per round is higher at later stages. However, there may be a shift towards increased funding in post-seed rounds.
Trending Categories in Crypto Fundraising:
DeFi projects are in second place in terms of the number of funding rounds, while Blockchain Infrastructure projects have a smaller number of funding rounds but larger funding amounts. Active investors primarily invest in blockchain service and DeFi projects, with some focusing on GameFi.
Notable Funding Rounds and Key Figures:
Most projects are raising smaller amounts, and investors are hesitant to invest significant amounts in crypto startups. Notable funding rounds include Stripe, eToro, and character.ai. Influential figures like Vitalik Buterin and Jack Dorsey have actively participated in funding rounds.
Hot Take:
The first half of 2023 saw a weak outcome in raising funds from private investors in cryptocurrency startups. However, with new trends, market recovery, and better regulation standards, we can expect a trend reversal. As the year progresses, we will see how these developments shape the future of the industry and pave the way for new innovations and collaborations.
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