Crypto Venture Capital Funding Reaches $1 Billion Once Again in Back-to-Back Months
Ruholamin Haqshanas
May 6, 2024 02:38 EDT
For the second consecutive month, crypto venture capital funding has surpassed the $1 billion milestone, indicating sustained investor enthusiasm for the industry.
Data from RootData reveals that in April, a total of $1.02 billion was invested in 161 funding rounds, slightly lower than March’s $1.09 billion across 186 rounds.
Nevertheless, this is the first time since October-November 2022 that the crypto sector has experienced two consecutive months of funding exceeding $1 billion.
Key Fundraisings in April
Notable fundraisings in April included a significant $47 million investment led by BlackRock in Securitize, a company specializing in real-world asset tokenization.
Another noteworthy development was the massive $225 million investment in Monad, a new layer-1 blockchain often referred to as a “Solana killer,” with support from Paradigm and Coinbase Ventures.
Significant injections of capital were also made into blockchain infrastructure startup Auradine and Cosmos-based layer-1 blockchain Berachain, receiving $80 million and $100 million, respectively.
In terms of sector distribution, blockchain infrastructure companies dominated the funding landscape in 2024, securing $1.7 billion, followed by decentralized finance protocols at $626 million.
In contrast, decentralized autonomous organizations received the least funding, with only $3 million raised so far this year.
The surge in venture capital funding reflects the overall growth trend in the blockchain industry.
With over $3.67 billion already invested in 604 funding rounds in 2024, the year is on track to surpass the $9.3 billion raised in 2023.
Since June 2014, the blockchain industry has received over $100 billion in funding through 5,195 rounds, according to DeFiLlama.
The increase in funding aligns with the ambitions of major VC firms like Pantera Capital and Paradigm, both seeking substantial amounts for new cryptocurrency funds.
Pantera Capital’s potential $1 billion raise would be the largest in the industry since May 2022 when a16z raised a record-breaking $4.5 billion.
Interestingly, a16z, despite raising $7.2 billion for investments in various sectors, including artificial intelligence and gaming, decided not to further strengthen its cryptocurrency-focused fund.
VC Funding Surges in Q1
Venture capital funding in the crypto space experienced a surge in the first quarter of 2024, breaking a two-year downward trend.
Both the total amount invested and the number of projects receiving VC funding have seen significant increases since Q4 2023.
The data shows a notable 38% increase in funds invested during the quarter, indicating renewed investor confidence in the crypto industry.
Moreover, there has been a remarkable 49% increase in the number of projects securing funding, a level not seen since Q4 2021.
In total, Web3 startups managed to secure just under $1.9 billion in funding across 346 deals in the first quarter of 2024.
This represents a significant 58% increase from the previous quarter, providing a glimmer of hope amidst the ongoing decline in overall crypto VC interest.
According to analysts at Bernstein Research, crypto funds could reach an astonishing $500 billion to $650 billion within the next five years, a substantial leap from the current valuation of approximately $50 billion.
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