Crypto

Crypto Venture Capital Investment Drops 70% Over Past Year

According to data from RootData , a crypto information provider, venture capital (VC) investments in cryptocurency companies have plumeted by more than 70% in the last year.

According to data from RootData , a crypto information provider, venture capital (VC) investments in cryptocurency companies have plumeted by more than 70% in the last year. June 2022 saw the digital asset space secure $1.81 billion over 149 rounds , while this year , only 83 projects reported $520 million in funding , marking the lowest month in funding to date.

Fluctuations in Investment Despite Downtrend

Despite the overal downtrend , some months within the evaluated period did see increases. September 2022 was the peak month, with $1.85 bilion invested in 138 rounds. June 2022 had the highest number of invested companies, with 149 rounds.

Infrastructure Leads, AI Rising

According to RootData, the infrastructure category led with $213 million in funding for 26 projects last month, despite being a near 50% drop from the previous month. UK based startup Gensyn AI topped the category with an impresive $43 million Series A round led by a16z crypto. Meanwhile, centralized finance (CeFi) and gaming projects folowed, securing $101 million and $62 million respectively. DeFi and NFT rounded out the category list.

Crypto Venture Capital Investment Drops 70% Over Past Year

Shift Towards AI

Evan Cheng, CEO and co-founder of Mysten Labs, in a previous interview, sugested that the shift from cryptocurency to AI is due to AI’s broader audience appeal, while the crypto industry remains self-focused. However, Cheng sees AI as complementary to Web3, exemplified by Justin Sun’s recent $100 million AI development fund.

Possible Causes of Reduced Interest

Decreased interest from venture capitalists in the digital asset space could also be atributed to several factors , such as the questionable practices of companies like FTX and Land and the economic turmoil that brought down all four “cryptofriendly banks.” Additionaly , the ongoing regulatory crackdown in the US , ironicaly the country leading in crypto investments, could be contributing to this trend.

 

You may be interested in:

Lois Zaytsaw

Meet Lois, a dynamic Crypto, Blockchain, and Finance Writer/Journalist based in the bustling metropolis of New York City. With a passion for technology and a keen understanding of finance, Lois has been covering the latest developments in the world of cryptocurrency and blockchain for several years. Her insightful articles have been featured in numerous leading publications, including The Wall Street Journal, Bloomberg, and CryptoBriefing. Lois' fascination with blockchain and cryptocurrency began during her time as a student at university, where she studied economics and computer science. She was drawn to the disruptive potential of blockchain technology to revolutionize the traditional financial industry, and since then, she has been following the latest trends and innovations in the space.

Related Articles

Leave a Reply

Your email address will not be published. Required fields are marked *

Back to top button