TLDR: Venture capital blockchain and crypto funding increased in Q4 2023
- Venture funding for crypto-related companies totaled $1.9 billion in Q4 2023, a 2.5% increase from the previous quarter
- Major crypto ventures securing funding primarily focus on financial and technological solutions
In the fourth quarter of 2023, venture funding for crypto-related companies reached $1.9 billion, marking a 2.5% increase from the prior quarter. This rise in funding is attributed to the growing interest of financial institutions in crypto, which can be linked to the U.S. launch of the first spot Bitcoin ETFs towards the end of last year. Major investments in the quarter centered around financial and technological solutions, including tokenizing real-world assets and building decentralized computing infrastructure. Notable fundraises included cryptocurrency exchanges Swan Bitcoin and Blockchain.com, as well as an open-source blockchain development platform called Wormhole which received a $225 million investment. Despite facing challenges in 2022, such as decreased VC funding and market difficulties, the crypto industry in 2023 saw significant moves like BlackRock entering the space and newcomers like EDX Markets joining the crypto exchange scene.
The first quarter of 2023 also saw crypto firms securing $2.6 billion in 353 investment rounds, showing an 11% decline in deal value from the previous quarter and a 12.2% decrease in total deals. Factors that contributed to decreased VC funding in 2022 included the collapse of the Terra ecosystem, the FTX collapse, and broader global economic factors like increased interest rates and inflation. Despite these challenges, the dynamic nature of the crypto industry was highlighted in 2023 with notable events and stories of adoption worldwide.
