In the first half of 2024, venture capitalist (VC) investments in crypto doubled compared to the previous year, reaching the record figure of 5.8 billion dollars.
Despite the notable market fluctuations, with the major cryptocurrencies experiencing swings of tens of billions of dollars week after week, the bull sentiment has prevailed.
This optimism has continued to attract significant investments from VC, as evidenced by the data from AltIndex.com. Let’s see all the details below.
VC investments in the crypto sector reach $5.8 billion
As anticipated, the year 2024 marked a significant recovery for investments in cryptocurrencies. Bitcoin, the largest and most expensive cryptocurrency in the world, saw its value increase by 47% in the first half of the year.
Other large-cap altcoins, such as meme coins and tokens related to artificial intelligence, have also recorded significant gains.
For example, the price of Shiba Inu has grown by 64% in six months, while AI tokens like AGIX (SingularityNET) have seen increases of 90% respectively.
The strong performance of criptovalute and the growing confidence of investors in a variety of digital assets have allowed crypto companies to raise much more capital compared to last year.
According to data from Crunchbase, the first half of 2023 saw a decline in venture capital investments for cryptocurrency companies, with a total of 2.9 billion dollars, the lowest figure since 2019.
The first two quarters of 2023 had raised 1.3 billion and 1.6 billion dollars respectively.
In the third quarter of 2023, funding had risen to 1.9 billion dollars. However, it then plummeted to only 787 million dollars in the last three months of the year. Thus bringing the annual total to 5.6 billion dollars, four times less compared to the previous year.
Recovery of the crypto market in 2024
After a difficult 2023, investors have returned to show interest in the cryptocurrency market. Data from Crunchbase indicates that in the first quarter of 2024, venture capital funding for crypto companies reached 2.7 billion dollars.
In particular, with an increase of 255% compared to the previous quarter. In the following three months, investments continued to grow, reaching 3.1 billion dollars, double compared to the same period of the previous year.
With a total of 5.8 billion dollars raised in the first six months of the year, cryptocurrency companies have already surpassed the 2023 total of 200 million dollars. Thus demonstrating a growing confidence of investors in the sector.
In addition to the doubling of capital raised in the first six months of the year, cryptocurrency companies have seen a significant increase in the number of funding rounds compared to the same period of the previous year.
With the return of venture capital investors to the cryptocurrency market, the total number of investments increased by 61%, reaching 1,404 in the first half of 2024.
The first quarter saw 736 investments, compared to 438 in the same period of the previous year. The trend continued in the second quarter, with a total of 668 investments, compared to 429 in Q2 2023.