Crypto startups secured $2.7 billion in venture capital funding during the second quarter of 2024, marking a slight increase from the first quarter, despite a notable drop in the total number of deals, according to a report from Pitchbook on August 9.

The report highlighted a 2.5% rise in total invested capital compared to Q1, even as the number of deals fell by 12.5%. This trend suggests growing confidence from institutional investors in the crypto market. “With positive investor sentiment returning to crypto and barring any major market downturns, we expect the volume and pace of investments to continue increasing throughout the year,” Pitchbook noted.

Infrastructure projects were the primary beneficiaries of this funding surge. Among the top recipients, Monad, a layer-1 platform, raised $225 million in a Series A round. DeFi protocol BeraChain, which introduced a new proof-of-liquidity model, secured $100 million in a Series B round, while Bitcoin restaking platform Babylon raised $70 million in an early-stage round.

Pitchbook also highlighted two significant “mega-rounds” during Q2: decentralized social media protocol Farcaster raised $150 million in a Series A round at a $1 billion valuation, and blockchain gaming platform Zentry secured $140 million in an early-stage round.

However, the report acknowledged that overall funding for crypto startups has slowed compared to the peak years of 2021 and 2022, which saw $25.3 billion and $29.4 billion raised, respectively. For 2023, total investment reached $10.1 billion, with projections for 2024 suggesting a total of $10.8 billion if current trends continue.

The competitive landscape for crypto startup funding has shifted, becoming increasingly competitive at early-stage fundraising but less so in later stages. Since June 2014, more than $102 billion has been raised across 5,400 funding rounds in the blockchain industry, according to DefiLlama.

Source: Crypto Startup Funding Growing to $2.7B in Q2 Despite Decline in Total Deals