Summary

2022 witnessed the highest number of crypto VC financing deals to date, with a total of 1,819 transactions. However, this number was 32% lower than the previous year. The total investment in blockchain and cryptocurrency firms also decreased by 68% from $33.3 billion in 2022 to $10.7 billion in 2023. Most investments were made in the first half of the year, with a decrease in the number of transactions awarded to mid- and later-stage firms and an increase in pre-seed, seed, and Series A businesses.

Introduction

In terms of overall investment, 2023 ranked as the third-highest year for crypto VC financing. However, it was still significantly lower compared to the extraordinary levels seen in the previous year. Despite the slump, the total investment in 2023 exceeded that of previous bearish markets, surpassing the $6.4 billion allocated in 2019-2020. The number of crypto VC deals also decreased by 32% compared to 2022, but remained consistent with the totals of 2021 and consistently higher than the monthly totals of 2020 and 2021.

Main Points

• The total number of crypto VC financing deals in 2022 reached 1,819, a 32% decrease from the previous year.
• Total investment in blockchain and cryptocurrency firms decreased by 68%, from $33.3 billion in 2022 to $10.7 billion in 2023.
• The majority of investments occurred in the first half of 2023, with a decrease in the number of transactions awarded to mid- and later-stage firms and an increase in pre-seed, seed, and Series A businesses.
• Data, trading, and enterprise sectors experienced a decline in transaction activity, while web3, infrastructure, and NFT/gaming remained the most active sectors.
• Bitcoin has shown signs of a solid year-end and the anticipation of the approval of a spot Bitcoin ETF by the U.S SEC has investors and traders excited for the upcoming year.

Conclusion

Despite the decrease in crypto VC financing deals and total investment in 2023, it still exceeded previous bearish market periods. The first half of the year saw the majority of investments, with a shift towards supporting early-stage businesses. Sectors such as web3, infrastructure, and NFT/gaming remained active, while data, trading, and enterprise sectors experienced a decline. With Bitcoin bouncing back and the potential approval of a spot Bitcoin ETF, all eyes are now on the upcoming year for further expansion in the crypto market.