Key Points:
- Crypto VC funding dropped sharply to $10.7 billion from the previous year’s $33.3 billion, marking a challenging year for the industry.
- First-half dominance of pre-seed, seed, and Series A investments overshadowed declines in mid- and late-stage deals.
- Despite economic challenges, 2023 showcased robust investment in NFTs, gaming, infrastructure, and Web3, indicating a diversified sectoral interest.
According to The Block data, crypto VC funding witnessed a substantial 68% drop, dwindling to $10.7 billion in 2023, a sharp contrast to the $33.3 billion invested the previous year.
Read more: VCs Steps Back, Crypto Funding Amount In June Hits Lowest In 2 Years: Report
Crypto VC Funding Landscape: 68% Plunge in 2023
Although the figures dipped, the total investment for 2023 managed to outshine the bear market of 2019–2020, which saw a total of $6.4 billion in investments.
The crypto VC funding landscape was characterized by a front-loaded first half of the year, experiencing a subsequent decline in the latter part. Notably, November saw a resurgence in investment activity. Intriguingly, the distribution of deals favored pre-seed, seed, and Series A startups in 2023, marking a shift from mid- and late-stage deals prevalent in the prior year.
While the economic slowdown impacted overall investment, the annual figures still surpassed those of the preceding bear market. A total of 1,819 crypto VC funding deals took place in 2023, marking a 32% reduction from the previous year’s 2,671 transactions.
In terms of sectoral distribution, 2023 witnessed a diversification of funds. NFTs and gaming sustained robust investment, joined by significant attention towards infrastructure and Web3. This departure from previous years indicates a dynamic investment landscape. Despite the challenges posed by the economic climate, the crypto space remains resilient, emphasizing a nuanced pattern of investment in emerging technologies and startups.
DISCLAIMER: The information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.
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