- Crypto and blockchain industries saw a $958M infusion of venture money.
- VCs continue to invest heavily in the bitcoin market despite its volatility.
- There has been a rise in the quantity and size of cash raised.
A recent report claims that cryptocurrency fundraising activity has increased. In February, the cryptocurrency and blockchain industries saw a $958M infusion of venture money.
Many venture capital firms have invested significantly in bitcoin and other cryptocurrencies, demonstrating their interest in cryptocurrency. So, it is common to observe a strong link between the price of bitcoin and the sum of money invested by VCs.
Notably, with 195 investment rounds raising a total of $1.5 billion since the beginning of 2023, there has been a considerable rise in the quantity and size of cash raised. This shows a substantial and expanding interest in investment opportunities across various businesses. Seeing this trend evolve throughout the rest of the year will be interesting.
For instance, there was an observation of a surge in venture capital investment during the first quarter of 2021, accompanied by a sharp rise in the price of bitcoin. Similarly, there was a substantial reduction in VC investment in the fourth quarter of 2022, accompanied by a collapse in the price of bitcoin to multi-year lows.
Despite its volatility, VCs continue to invest heavily in the bitcoin market because they believe it has room for long-term growth. With a combined total of 622 million USD raised in Q4 for pre-seed and seed rounds, VCs continued to focus on early-stage funding rounds.
Conversely, later-stage rounds like Series A, B, C, and D typically feature fewer profitable projects and a higher overall capital raised. There might be a move towards more funding in post-seed rounds as the cryptocurrency market grows and higher-quality startups emerge.
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